Here’s what is happening in and affecting South Africa today:
Coronavirus: Global Covid-19 infections have now passed 14.2 million reported infections, with the death toll at 602,000. In South Africa, cases continue to rise rapidly, with the total confirmed cases now at 364,328, and 5,033 deaths. Recoveries have increased to 191,059, leaving a balance of 168,236 active cases.
- Worse than you think: As South Africa hits morbid milestone after morbid milestone around the coronavirus, health experts have warned that the data may be worse than many think, particularly with a high number of under-reported deaths. People who die before being tested for the virus, and those who die of other causes, but were unable to get treatment because of hospitals at capacity, are not included in official numbers. Under-reporting is rife in small towns and villages, the experts said. [Bloomberg]
- Rate cut: South Africa could get another rate cut this week, as the Reserve Bank’s Monetary Policy Committee again sits to figure out what move to make in with the stagnating economy. A move to cut rates again is supported by projections that South Africa’s economy will decline by more than the 7% predicted by SARB earlier in the year. Lower rates will help spur some economic activity – however, economists note that households are struggling under the weight of a loss of income. [Daily Maverick]
- Restaurant action: South African restaurants are planning the biggest protest seen in the sector, where hundreds of businesses plan to take to the streets on Wednesday in protest of the latest lockdown restrictions. The sector has largely been shut down since the start of the lockdown in March, and has only been able to re-open in limited capacity. A ban on alcohol sales has hit many hard, and livelihoods have been lost with the current restrictions making it nearly impossible for many to run profitably. [Moneyweb]
- SAA funding: While government has committed to finding funds for the ‘new’ SAA, it has not yet secured any. Meanwhile, top officials say that the new airline might function independently, with a similar structure to state telecoms group, Telkom, rather than being completely state-owned. Telkom is 37% owned by the state, and is listed on the JSE. While government has not committed to this structure, it said it is an interesting direction to look at going in. [Reuters]
- Markets: The rand remains on solid footing despite disrupted power supplies, Covid-19 fears and local political tension over SAA bailouts. As we start another week of intensified lockdown rules, South Africa continues to struggle to contain new cases and now ranks in the top five most infected countries globally. The USD remains under pressure as the US trading conflict with China continues to weigh on sentiment. On Monday, the rand is at R16.74 to the dollar, R20.97 to the pound and R19.13 to the euro. Commentary by Peregrine Treasury Solutions. [XE]