The slightly stronger US dollar pushed net gold and foreign exchange reserves lower in February, showing that the Reserve Bank has not made use of favourable market conditions to increase forex reserves, or to weaken the uncompetitively high rand.
Gross reserves dropped by a marginal 0,3% to US$39,4bn, compared with January. The international liquidity position weakened by 0,9%, to $38,3bn, mainly as a result of the US dollar's gains. And the gold price, which rose to $1 109,4/oz, partially offset these effects, adding about $100m to the $4,4bn value of gold reserves.
SA has continued to take advantage of its reasonably stable finances by tapping global capital markets at favourable terms. This week, national treasury quietly issued a $2bn global bond. It was three times oversubscribed and priced above comparable US bonds, at a record low coupon rate of 5,5%, says Nedbank economist Isaac Matshego.
Foreign portfolio inflows continued. Net foreign purchases of foreign assets amounted to R9,4bn, with net equity purchases of R2,5bn and net bond purchases of R6,9bn. At current levels, reserves will cover about seven months of imports.
Razina Munshi
43 points. Business confidence jumped by 15 points during the first quarter of 2010. This is the single biggest increase between two consecutive quarters in 16 years, and the same level that prevailed before the global financial crisis erupted.
3,4 percent. A March Reuters poll puts seasonally adjusted first-quarter GDP growth at 3,4%. This is higher than a month ago, proving that the economy is gaining traction. The low base that the economy is moving off bodes well for GDP.
79,03 dollars a barrel. The price of Brent crude oil rose to US$79,03/bbl this week, from $76,68. Commodity prices have risen, supported by speculation that better global sentiment will boost demand.
Last week, the price of gold rose to its highest level in six weeks, US$1 139/oz, as optimism over the outlook for the global recovery enhanced the appeal of commodities. According to the US bureau of labour statistics, US payrolls fell by 36 000 in February. The better-than-expected payrolls data boosted sentiment that the recovery in the world's largest economy is well under way. However, speculation that the US may undergo a jobless economic recovery sparked concern of a double-dip scenario.
Coming into this week, the price of Brent crude jumped to its highest level in nearly eight weeks as fluctuations in the dollar, rising investment demand and increased risk aversion enhanced the appeal of higher-yielding assets, including commodities. Data from the US Commodity Futures Trading Commission suggests that speculative positions in oil rose 7,1% to 91 417 contracts in the week ended March 2. Furthermore, growing confidence about the outlook for the global economy boosted demand prospects for crude oil.
Commodities - Platinum rise |
At the start of this week, the price of platinum jumped to a six-week high of US$1 610/oz on optimism that demand for the metal used in auto catalysts will increase as the global economic recovery gathers pace. The price of platinum was boosted even further after the euro rose against the dollar on speculation that wealthier European nations would bail out the Greek economy.
Ranking the Analysts 2009
