Here’s what is happening in and affecting South Africa today:
Load shedding: No load shedding expected on Tuesday, though the risk of implementation remains high as emergency reserves are being used during peak periods.
- Don’t panic: Shelves at stores have been left empty as South Africans enter into a phase of panic buying, following the declaration of a state of disaster – and officials say it’s completely unnecessary. Stores have started limiting the number of high-demand items a single customer can purchase, while academics are describing the behaviour as selfish and wasteful – especially considering most of the items bought are perishable and won’t last. Government says restrictions won’t impact supply chains and imports – so stop panicking. [TimesLive]
- JSE wipeout: The JSE All Share Index has lost about R2.3 trillion since mid-February because of the global market panic over the Covid-19 coronavirus – R500 billion of which was lost this week so far. On Monday, the ALSI dropped by 10%, having fallen 32.6% since the start of the year. Every sector is being hammered, but petrochemicals are being hit particularly hard due to crashing oil prices, which exacerbate the issues those stocks face. [Moneyweb]
- Interest rates: With no detail coming from government on any stimulus package for the South African economy in the wake of the coronavirus market panic, analysts are looking to the Reserve Bank for a move to cut interest rates later this week. However, finance minister Tito Mboweni said that an interest cut is no panacea, and the key for businesses in South Africa is not to panic and shut down operations, to keep the economy moving. Economists have noted that even a 1% cut to rates wouldn’t be enough to undo the economic downturn brought by the virus. [CNBCA]
- Dipping into UIF: Cosatu says that government needs to find a way to make use of the billions of rands tucked away in the Unemployment Insurance Fund to help mitigate the damage done to workers by the coronavirus outbreak. It says government should use the fund to pay workers who have been laid off or are unable to work because of the virus. This includes temporary layoffs, and support for companies that have been forced to shut down. [Bloomberg]
- Markets: South Africa’s rand weakened against the dollar on Monday as the deepening coronavirus crisis roiled financial markets, with focus shifting to the central bank interest rate decision due later in the week. The South African Reserve Bank (SARB) is expected to cut interest rates on Thursday, but the easing is likely to be less aggressively than other global central banks trying to mitigate damage from the virus outbreak. On Tuesday, the rand was at R16.62 to the dollar, R20.39 to the pound and R18.59 to the euro. [XE]
Coronavirus: Global cases are at 182,683, with 79,883 recoveries and 7,173 deaths. 95,627 cases are still active, with 6,163 being in critical condition. There are 62 confirmed cases in South Africa.