We have seen markets trading sideways with a slight sense of risk-off sentiment today after global banks concerns have taken over this week. The bailout of banks in Switzerland and the US has dominated headlines, while the ECB stuck to their 50bps hike yesterday as inflation remains a concern in the eurozone. Markets have calmed down following the bailouts and now fully focus on next week’s FOMC meeting, where we will see if the downward trending inflation and financial market instability this week will push the Fed to a more Dovish outlook. For now, the dollar is trading range-bound against the euro and the pound, with the Yen trading firmer this afternoon. Coherently, the rand has tracked the riskiest asset classes and closed the week on a softer note, around the R18.40 level.

Brent Crude falls further, while gold is up

Price movements in Brent Crude and Gold have been complimenting what is happening in financial markets, as the two are measures of different things. Crude is trading down 2.5% for the day, with concerns of a slowdown in the global economic outlook and a hard landing in the US keeping oil prices lower. Gold, on the other hand, has rallied to above $1,950 on its safe-haven status after markets have been highly volatile this week. Other PGMs still find life difficult, but not to the same extent as Crude. Next week’s FOMC meeting can not be emphasized enough, as it can set in motion a train of events that could lead to market volatility returning yet again.

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