Global financial markets remain focused on the talks between Mr Trump and Russian President Putin. Locally, all eyes are on the CPI print later this week.
International Market Developments
Unexpectedly, US CPI for July remained steady at 2.7% y/y. On a m/m basis, CPI for July registered in line with expectations, at 0.2%. Core CPI came in higher than expected, increasing by 3.1% y/y (0.3% m/m) in July, after having increased by 2.9% y/y (0.2% m/m) in June. Core CPI was driven by higher services prices, which increased the most since the start of the year. Prices of airfares, medical care and recreation also increased in July. Goods inflation increased at a relatively subdued pace, while categories exposed to tariffs increased at a slower pace than in June
On geopolitics, talks between President Trump and Russian President Putin in Alaska on Friday did reveal Putin’s conditions for peace. He has demanded that Ukraine surrenders the Donbas region and abandons any ambition to join NATO in return for freezing the conflict along the frontlines. President Trump also changed his mind on the need for an immediate ceasefire in Ukraine, now concentrating instead on a long-lasting peace deal, while the threat of further sanctions or tariffs on Russia seem to have also been dropped. On tariffs, the President said over the weekend that he has no imminent plans to increase levies on China due to their purchases of Russian oil, a change in tone relative to previous weeks.
The US and China have agreed to extend their tariff truce, pushing the deadline into early November. This further extension gives both sides more time to work through longstanding trade concerns.
Local Market Developments
President Cyril Ramaphosa called for the mainstreaming of gender equality across all levels of government policy and decision making. The president emphasized that no policy or government action should be taken without considering its direct impact on women. Ramaphosa added that the National Dialogue aims to address persistent social, economic and political challenges, including inequality, unemployment, gender-based violence, and service delivery issues.
The SA unemployment rate increased in Q2:25, to 33.2%, from 32.9% in Q1:25. Based on the expanded definition, the unemployment rate decreased to 42.9% in Q2:25, from 43.1% in Q1:25.
This week, the markets are focused on the upcoming July FOMC meeting minutes, due on Wednesday, which will likely offer insight into how Fed policymakers assessed tariff pass-through, and their risk management approach to policymaking. Fed Chair Jerome Powell is due to deliver his speech at the Jackson Hole Symposium on Friday.