Market Commentary | The week that was
Last week’s news was overshadowed by the passing of Her Royal Highness Queen Elizabeth II. Her funeral will occur on September 19, honouring her lifetime of devotion and steadfast service.
Meanwhile, the European Central Bank (ECB) has raised interest rates by 75 basis points in an attempt to tackle record inflation highs. This comes despite high energy costs that may push the eurozone into a recession. The higher rates will lift the bank’s benchmark deposit rate from zero to 0.75 per cent — the highest level since 2011. The ECB has also indicated that several further increases may be on its way if the inflation level stays high.
Local news is that the SA construction sector seems to be recovering. The latest Afrimat index shows an increase of 2.4% from the first quarter of the year amid a 4.1% increase in the value added to the economy Dr Roelof Botha (Optimum’s Economist), was quoted in Moneyweb today, saying that municipalities take too long to approve building plans and their legal requirements. ‘We have an overregulated economy – it’s not even debatable’, Botha said. Looking at the week ahead: Today: Release of the latest edition of the ABSA manufacturing survey, compiled by the Bureau for Economic Research (BER) at Stellenbosch; Tuesday: US inflation rate to be announced, amid expectations that the headline Consumer Price Index (CPI) will decelerate to 8% from 8.5% and Core to 6.1% from 5.9%.