Social grants on trial in South Africa, and the United States vows economic D-Day

On Monday, 24 August, the rand held steady at R16.00/$, after closing at R16.01/$ on Friday, 21 August.

Emerging-market currencies were mixed on Friday, with the Brazilian real, Colombian peso and rand among the biggest gainers.

Asian equity markets are weaker, with the Nikkei, Hang Seng and Shanghai Composite all trading lower.

Geopolitical tensions remain a key focus after the US signalled that it would intensify its economic campaign against Iran with a new round of sanctions.

Tehran warned that countries supporting the measures could be viewed as participating in an “act of war”.

Several central banks are also in focus this week. The Bank of Thailand is expected to leave its benchmark rate unchanged at 1.00% on Wednesday.

Meanwhile, the Bank of Korea is expected to raise its benchmark rate by 25 basis points on Thursday. The Philippines’ central bank could also raise rates as inflation remains above target.

China will release its industrial profit data for July on Thursday. Growth is expected to remain robust, although it may have slowed as strong technology demand offsets weakness elsewhere in the economy.

In Europe, Germany’s IFO business climate index is due tomorrow and is expected to improve to 87.2 from 86.6 in July.

The eurozone will release its final consumer sentiment reading for August on Friday, while economic confidence is expected to improve to 97.6 from 96.9.

The main event in the US this week will be Fed Chair Kevin Warsh’s speech at the Jackson Hole Economic Symposium on Friday.

Markets will watch for clues on the Federal Reserve’s approach to inflation and interest rates. Warsh could either reassure markets about the Fed’s policy direction or maintain his preference for limiting forward guidance.

The US will also release its Case-Shiller house price index and Conference Board consumer confidence data tomorrow. The core PCE inflation gauge is due on Wednesday and is expected to have risen 0.2% month-on-month in July.

Thursday brings the US advance goods trade balance, while the University of Michigan’s final consumer sentiment reading for August is due on Friday.

Locally, the SARB’s leading indicator for June is due tomorrow. The July producer price index will follow on Thursday.

It is expected to show annual inflation of 6.0%, down from 7.5% in June. South Africa’s monthly budget balance for July is also due on Friday.

In commodities, Brent crude is at $93.01 per barrel, down this morning but still up 52.8% year-to-date. Gold is trading at $4,632 per ounce, up 7.3% since the start of 2026.

South Africa’s 10-year generic bond yield is at 8.78%, while the R2035 is yielding 8.56%. The US 10-year Treasury yield is at 4.71%, with the German 10-year Bund at 3.25%.

Important finance and investing news

United States vows economic D-Day: The US is preparing a major new sanctions campaign against Iran, while Tehran has threatened to halt all Gulf oil exports if the economic pressure continues, raising fresh concerns over global energy supplies. [Reuters]

Social grants on trial: The state is heading to the Supreme Court of Appeal this week after the Pretoria High Court ruled that social relief distress grants are a permanent facility that encroaches on the executive’s powers. [BusinessDay]

Investors eye Nvidia: Wall Street is closely watching Nvidia’s results on Wednesday, with the chipmaker’s AI outlook expected to influence the broader technology sector and the stock market amid growing concerns about rising costs, debt, and AI spending. [Wall Street Journal]

Shein goes out of style: Shein is targeting a Hong Kong IPO valuation of up to $27 billion, about 70% below its private-market peak, as slowing growth, higher costs, tariffs and regulatory scrutiny weigh on the fast-fashion retailer. [Reuters]

South Africa faces a R1.6 trillion funding gap: The government is seeking private-sector investment and new funding to support major projects, improve municipal infrastructure, and close South Africa’s R1.6 trillion infrastructure funding gap. [SABC News]