Tag: commodity prices

As South Africans continue to suffer from numerous government failures, there is a small ray of hope emerging. The private sector is stepping up to do the job where they are allowed to do so. This is exemplified in three stories that came out in the first two weeks of June.

June was a brutal month for global equities, capping the worst first half of a year since the launch of the MSCI All Country World Index in 1987. For indices with longer track records, the story is worse. In the case of the US S&P500, the first half performance has not been this bad since 1962.

A record sell-off coupled with a shifting economic backdrop mean opportunities in global fixed income markets have appeared. It has been an extraordinary time for bond markets. As an asset class, fixed income is often seen as equities’ boring cousin, particularly over the past decade of low yields. Recent months, however, have been anything but boring, albeit for the wrong reasons.

The prolonged Russia-Ukraine war is ushering in a new era of volatility and possible recession for South Africa and the world. When Finance Minister Enoch Godongwana delivered his maiden budget speech in February 2022, little did he know that Russia would invade Ukraine the very next day, immediately changing both the world and South Africa’s economic outlook for 2022 and beyond.

It’s been a busy time for the US dollar. On the one hand, it has featured heavily in commentary on the future of the global monetary system. On the other hand, it has surged in foreign exchange markets. In other words, even as many commentators question the future of the dollar as global reserve currency, participants in foreign exchange markets have scrambled to buy more dollars.

Global and domestic food security remains under extreme threat. Climate change has always been the main driver for the threat, however, the recent invasion of Ukraine by Russia has drastically increased concerns about the impact of war on soaring food prices and input costs.

The bigger the military operation, the more sophisticated the financial machinery required to fund it. The Bank of England, today still the UK’s central bank, was created in 1694 as the government’s bank, largely to finance its ongoing wars with France.

Chief Economists from in a variety of countries globally released the Global Economic Outlook paper this week which provides detailed insights into the global obstacles and opportunities. Surprisingly, while the pandemic may not be over, the major economies are shifting their mindset and focusing increasingly on the potential risks and rewards of a more sustainable long-term recovery and route to sustainable growth.

South African Finance Minister Enoch Godongwana tabled the 25th Medium-Term Budget Policy Statement today, where he emphasised the budget’s focus on navigating the country’s path toward an economic and social recovery.

The Medium Term Budget Policy Statement (MTBPS) 2020 was tabled to Parliament on 11 November 2021 by South African Finance Minister Enoch Godongwana.