This week saw the results of the much anticipated midterm elections. The Democrats took the House and the Republicans maintained control of the Senate. This could initiate a lot of friction within American politics and could signal the end to the smoothest period of Donald Trump’s Presidency. As always, the President is handling this blow with dignity and grace.
Global News
- The midterm election results were that the Democrats took the House and the Republicans have maintained control of the Senate. For more on the 2018 midterm elections follow this link for ten takeaways.
- In the lead up to the midterm elections Trump said that voting for the Democrats would send stocks plummeting, so far the opposite has been true.
- This week, Attorney General Jeff Sessions stepped down at the request of Donald Trump. Trump then appointed Matthew Whitaker (a Trump acolyte who openly criticised the Russia collusion probe) as the new Attorney General, giving him the power to oversee Special Counsel Robert Mueller’s investigation.
- According to Gary Cohn, formerly President Trump’s top economic advisor, the US-China trade war will continue. Cohn said at Bloomberg’s New Economy Forum that the President has found, “one economist on Amazon who thinks trade deficits matter, and he listens to him.”
- The White House suspended the press pass of CNN’s Jim Acosta. For the full video of their interaction follow the link.
- Last night, the Fed decided to leave the rates unchanged. This was highly anticipated by the markets and so made hardly any impression. There is an expected 25bps interest hike towards the end of the year or start of 2019.
- On Monday American sanctions on Iranian oil came into effect.
Local News
- This week the rand was one of the best performing Emerging Market currencies.
- The South African Chamber of Commerce and Industry (SACCI) Business Confidence Index rose to 95.8 in October from 93.3 in September. This is the second consecutive increase in the Index – it was supported by higher import volumes, vehicle sales, and retail sales.
- In more positive news, Eskom revealed plans to reduce staff costs by retrenching senior management. While it is not yet clear how many employees will be impacted, this will help the power utility to curb high operating costs.
- Energy Minister Jeff Radebe has hinted at possible Saudi Arabian investment in oil-refining hubs in South Africa but has called for a collaborative approach from Africa to attract investment.
- There was news early in the week that Finance Minister Tito Mboweni was interested in closing South African Airways (SAA) down. Since then many have come to the defence of SAA, among them was President Ramaphosa, making the future of SAA uncertain. Here is a link to what Ramaphosa had to say in parliament about SAA and here is a link to an interview with the CEO of SAA.
