Strong US numbers continue

The list of US economic data that surprise to the topside continues, as Retail Sales for January print higher than expected. The market’s reaction on the back of the number was bullish for the dollar, with the greenback currently trading below 1.20 against the pound and at 1.0660 against the euro. The dollar index is touching the 1.04 mark for the first time since November 2022. 

Rand Update

Locally there has not been much reaction with local data releases, with local retail sales being a second-tier number and CPI printed in line with expectations. We continue to track any moves in the dollar, with the risk premium built into the rand due to local issues yet to phase out. The rand closes the day above the R18.00 handle, as we remain stuck in the R17.80 to R18.10 range for now, but the currency does feel overwhelmingly overstretched at the current levels. 

Commodities under pressure

Palladium is leading the way for commodities to trade on the back foot, losing a massive 3.5% on the day. Palladium has been under pressure recently due to a slowdown in demand for its use in automotive catalytic converters, and the announcement by the European Parliament to ban the sale of non-electric vehicles from 2035 has hammered the metal further today, trading at $1,440. Other metals have also been under pressure, with gold and platinum losing just over 1%.

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