South Africa, and especially the alcohol and tourism sectors, cheered the government’s surprise move to keep the country on lockdown level 1 despite the rapid spread of the omicron variant. Any other decision would’ve thrown shade on our pleas for countries not to punish us with travel bans and further constricted the economy which already suffered a worse-than-expected 1.5% contraction in the third quarter due to more stringent Covid-19 restrictions, travel bans and the hit of the July riots. Business Unity South Africa said it was the right decision as South Africans would not have survived another hard lockdown, while wine industry bodies Vinpro and the National Liquor Traders Council said any more tighter measures would have had a serious effect on wine sellers, wine tourism destinations and the thousands of families that depend on the industry for their livelihoods.
In other parts of the world, omicron has prompted France to restrict travel from the UK, the English Premier League to postpone soccer matches, including Manchester United’s Saturday clash against Brighton & Hove Albion as the UK clocks record-breaking daily infections, and US conglomerates to let people work from home again. Also in the US, the Centers for Disease Control and Prevention recommended vaccines made by Moderna and Pfizer for use in adults over Johnson & Johnson’s shot, which has been linked to rare but serious blood clots.
Back home, although a small study of seven cases has shown that omicron can break through booster shots, medical professionals say vaccinations are still an essential tool in the fight against the pandemic as it protects against severe disease and death.
In the markets, the rand strangely strengthened following an expected hawkish Federal Reserve. The FOMC said it will accelerate tapering from December into March and look to end the asset-buying program by Q1 2022. This effectively will open the window for a first-rate hike in April 2022, and markets are now pricing in six hikes until the end of 2023, says TreasuryONE. “The reaction of the rand did seem relatively muted and rather strangely strengthened after the meeting. The immediate reaction of the rand was to trade weaker up towards the higher R16.20s but has since recovered a substantial amount.” comments TreasuryONE.
“The main contributors could be the fact that a very hawkish sentiment was expected and that Fitch revised our credit rating from negative to stable, still below investment grade. The rating agency came out on Wednesday evening stating that the fiscal deterioration has abated for now,” says the forex trading house.
The local unit was last trading at R15.91 against the US dollar from R16.26 on Wednesday just after the local market close. South African markets were closed on Thursday for the Day of Reconciliation public holiday.
Commodities have meanwhile also recovered since Wednesday, with palladium jumping back above $1,724 after trading at $1,540 on Wednesday evening. Gold gained to trade just above $1,800 while platinum is also slightly up at $934. This morning, Brent Crude is down 1%, trading at $74.20 a barrel.
Here’s a roundup of the world’s top and most interesting headlines:
SA Business
- Expensive braai season looms as meat prices hit record high for December – TimesLive
- How much you money would have if you invested R1,000 in these SA tech companies at the start of 2021 – MyBroadband
- SA ‘could soon face stage 8 load shedding’, Eskom warns – African Insider
Global Business
- Global demand for coal could hit all-time high in 2022 – The Guardian
- China allows Tencent to publish app updates again after suspension – Reuters
- Daily Mail publisher to delist from stock market after 90 years –The Guardian
Markets
- Goldman says $100 oil possible as record demand outpaces supply – Bloomberg
- Asian markets slip after rally as traders consider higher rates – AFP
- Gold up after key central banks tighten monetary policies – Investing.com
Opinion/In-depth
- Time to overhaul the Covid-19 guidelines – Daily Maverick
- Moving African rhinos: what it takes to translocate an endangered species – The Conversation
- What to do if you test positive for Covid-19 over the holidays – BusinessTech
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