Daily Market Report 29 Apr

Daily Market Report – 29 Apr 2025

Key Updates

  • SA Politics:
    The DA’s pressure forced the VAT hike to be dropped. Now the GNU must cut spending or find new ways to fill the R75bn budget gap.
    Finance Minister Godongwana won’t resign, but the pressure on him is rising.
    Local investors are starting to prefer SA investments over offshore – for the first time in five years!
  • Global News:
    In Canada, Mark Carney’s Liberals stay in power as they gear up to fight Trump’s trade war.
    Trump is backing down on tariffs against China after realising they were hurting the US economy more than helping.
    US economic data out this week (GDP, jobs, retail) could show if tariffs are already slowing the US economy.

Market Insight – ZAR Outlook

  • ZAR strengthened below 18.60 as:
    • US bond yields fell.
    • Positive signs that the GNU will survive and a more responsible budget is coming.
  • But:
    Without tough reforms (cutting government spending, shrinking cabinet), SA risks bigger problems.

Global FX Moves

  • USD weakens as traders expect slower US growth.
  • EUR/USD steady around 1.1400.
  • GBP/USD is around 1.3270, could rise if US data disappoints.
  • USD/JPY stays weak after Trump chaos.

Bonds and Rates

  • Bonds are cautiously stronger.
  • Local yields dropping on hope for SARB rate cuts.
  • Markets now price in up to 65bp of SARB cuts by early 2025.
  • Big focus on US GDP and job data later this week.

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