Equity markets are mixed currently with US data expected to yet again show over million more Americans sought unemployment benefits the last week while new applications declined. Stock markets traded mixed yesterday despite positive US reports.
Forex news
Currency Pair
Change
EUR USD
-0.88%
GBP USD
+2.17%
USD JPY
+0.06%
The Dollar strengthening has halted today ahead of a Labor Department report expected to show over 45 million Americans likely sought unemployment benefits over the last thirteen weeks. The live dollar index data show the ICE US Dollar index, a measure of the dollar’s strength against a basket of six rival currencies, added 0.1% Wednesday as both housing starts and building permits rose in May. EUR/USD and GBP/USD continued sliding yesterday but both pairs are up currently ahead of the Bank of England policy meeting today with no policy change expected. Both USD/JPY and AUD/USD continued retreating yesterday with both pairs lower currently.
Stock Market news
Indices
Change
Dow Jones Index
-0.26%
Nikkei Index
-0.97%
GB 100 Index
+0.26%
Australian Stock Index
-0.92%
Futures on three main US stock indexes are up after a mixed trading on Wednesday. Stock indexes in US ended mostly lower on Wednesday while technology stocks edged higher as Fed chair Powell said during day two of his Congressional testimony some form of unemployment insurance should continue past the expiration date of July 31. The three main US stock indexes recorded returns ranging from -0.7% to +0.1%. European stock indexes are extending gains currently following a two-session-in-a-row advance Wednesday. Asian indexes are mostly lower today led by Australia’s All Ordinaries ASX 200 after report Australia’s unemployment rate jumped to 7.1% in May, a 19-year high.
Commodity Market news
Commodities
Change
Brent Crude Oil
+1.25%
WTI Crude
+0.71%
Brent is edging higher today. Prices pulled back Wednesday after the US Energy Information Administration report that US crude oil inventories rose 1.2 million barrels last week for second week in a row. The US oil benchmark West Texas Intermediate (WTI) futures fell: July WTI lost 1.1% and is down currently. August Brent crude closed 0.6% lower at $40.71 a barrel on Wednesday.
Gold Market News
Metals
Change
Gold
+0.11%
Gold prices are extending losses today. August gold slipped 0.1% to $1720.70 an ounce on Wednesday.
Note: This overview has an informative and tutorial character and is published for free. All the data, included in the overview, are received from public sources, recognized as more or less reliable. Moreover, there is no guarantee that the indicated information is full and precise. Overviews are not updated. The whole information in each overview, including opinion, indicators, charts and anything else, is provided only for familiarization purposes and is not financial advice or а recommendation. The whole text and its any part, as well as the charts cannot be considered as an offer to make a deal with any asset. IFC Markets and its employees under any circumstances are not liable for any action taken by someone else during or after reading the overview.
Bank of England is expected to increase bond purchases at today’s meeting: bond purchases are expected to be expanded to 745 billion pounds from 645 billion. This is bearish for GBPUSD.
The Pound is consolidating around the mid-1.20 range against the US Dollar, in the lead up to the Bank of England’s monetary policy decision due at noon UK time Thursday. Although the BOE is unlikely to adjust its benchmark interest rate, currently at 0.1 percent, the central bank is instead expected to add some 100 billion Pounds to its bond-buying programme, bringing the total target to 745 billion Pounds.
Recent economic data has given added reasons for policymakers to boost its stimulus plans. The UK economy contracted by 20.4 percent in April compared to the month prior, while inflation in May registered at just 0.5 percent, which is only one quarter of the central bank’s target. Other recent dismal economic prints include April’s industrial production, which fell by 24.4 percent on a year-on-year basis, while the Index of Services shrunk by 19 percent month-on-month. Facing what could be its deepest recession in three centuries, the UK economy is in clear need of more support.
Initially thought to be a non-event, the greater case for more monetary policy stimulus for the UK economy could see heightened volatility for GBPUSD in the wake of the BOE’s announcement, especially if the central bank were to employ new policy tools such as the yield curve control.
Looking further down the line, should recent stimulus measures fall short, the Bank of England might have to push interest rates into negative territory, possibly by Q1 2021, and thus following in the footsteps of the European Central Bank and the Bank of Japan. Such a move however isn’t without its complications, and its heightened prospects could weigh on Sterling’s performance moving forward. The risk of the UK entering a no-deal Brexit at the start of next year is also dampening Sterling’s upside.
Facing such downside risks, no wonder that the Pound is weaker on a year-to-date basis against all G10 and Asian currencies, except for the Norwegian Krone and the Indian Rupee.
GBPCHF is another currency pair to watch today, with the Swiss National Bank also due to make a policy decision in the coming hours. The SNB’s policy rate will likely stay unchanged at minus 0.75 percent.
The Franc remains the best-performing G10 currency against the Dollar so far this year, even as the central bank actively stems CHF’s advances amid concerns over the global pandemic. Although the Pound has strengthened by 0.5 percent against the Franc over the past one month, further gains for GBPCHF appear limited even with the SNB’s interventions. This is primarily due to the downcast outlook over the Sterling, with risks to the UK economy still tilted to the downside.
Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.
Mozambique’s central bank cut its benchmark interest rate for the second time this year and for the 13th time in just over three years, saying risks and uncertainties in the economy have worsened “significantly” due to military instability in the northern part of the country along with the impact of the Covid-19 pandemic. The Bank of Mozambique (BM) cut its monetary policy rate (MIMO) by 100 basis points to 10.25 percent and has now lowered it by 250 point this year. Since April 2017, when BM began easing its policy stance, the rate has been cut 11.50 percentage points. BM forecast inflation will remain low through this year and next year due to a greater contraction of domestic demand, the impact of Value-Added-Tax exemption, a fall in the prices of some basic goods and services, and expectations of economic agents. It added a May survey of inflation expectations pointed to inflation below 5.0 percent for 2020 and 2021. Mozambique’s government has set a medium-term inflation objective of 5-6 percent. Mozambique’s inflation rate eased to 3.02 percent in May from 3.32 percent in April while its economy grew 1.68 percent year-on-year in the first quarter of this year, up from 1.51 percent in the previous quarter.
Shares of Edesa Biotech traded more than 100% higher after the company reported that it had received regulatory approval from Health Canada to initiate a Phase 2/3 study of its investigational drug EB05 in COVID-19.
Clinical-stage biopharmaceutical company Edesa Biotech Inc. (EDSA:NASDAQ), which is focused on developing treatments for inflammatory and immune-related diseases, today announced that “it has received expedited approval from Health Canada to begin a Phase 2/3 clinical study of its investigational drug, EB05, which the company is developing as a potential treatment for moderate to severe COVID-19 patients.”
The firm indicated that it a has sufficient EB05 drug product available now and plans to begin the study at up to 30 sites. The company advised that it is also currently seeking government grants to accelerate the commencement and roll out of the study.
The company explained that “EB05 is a monoclonal antibody that has demonstrated the ability to suppress the release of proinflammatory cytokines that are often observed in severe COVID-19 patients and that specifically, the drug inhibits toll-like receptor 4 (TLR4) signaling – a key component of the innate immune system and an important mediator of inflammation responsible for acute lung injury that has been shown to be activated during SARS and Influenza infection.”
The firm stated that it plans to enroll as many as 355 patients in the first phase of the Phase 2/3 EB05 trial, which is planned to be a multi-location study to evaluate the efficacy and safety of EB05 in moderate to severe adult hospitalized COVID-19 patients.
The company’s CEO Dr. Par Nijhawan commented, “Health Canada’s expedited review process and subsequent approval of our Clinical Trial Application represents a significant step in developing new drugs that can treat the underlying conditions induced by the SARS-CoV-2 infection…We greatly appreciate the actions being taken by the government to expedite COVID-19 applications and provide support for clinical studies.”
Edesa Biotech is a clinical-stage biopharmaceutical company based in Markham, Ontario, and also has offices in the U.S. located in southern Calif. The firm develops treatments for inflammatory and immune-related diseases particularly those with clear unmet medical needs.
Edesa Biotech started off the day with a market capitalization of around $25.7 million with approximately 8.859 million shares outstanding. EDSA shares opened 140% higher today at $6.97 (+$4.07, +140.34%) over Friday’s $2.90 closing price. The stock has traded today between $5.80 and $10.00 per share and is currently trading at $6.17 (+$3.27, +112.76%).
Disclosure: 1) Stephen Hytha compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. He or members of his household own securities of the following companies mentioned in the article: None. He or members of his household are paid by the following companies mentioned in this article: None. 2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees. 3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. 4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports. 5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. 6) This article does not constitute medical advice. Officers, employees and contributors to Streetwise Reports are not licensed medical professionals. Readers should always contact their healthcare professionals for medical advice.
Fund manager Adrian Day discusses why he likes the proposed merger of Evrim Resources with Renaissance Gold, plus he names some companies on his buy list.
Evrim Resources Corp. (EVM:TSX.V, 0.35) is merging with fellow junior prospect generator Renaissance Gold Inc. (REN:TSX), doubling the size of the company, to create Orogen Royalties, a self-defined “organic royalty generator.” The merger brings together Evrim’s near-term royalty on the Ermitano project and multiple projects and joint-ventures in British Columbia and Mexico with Renaissance’s further-out but potentially much larger royalty on the Silicon project with multiple exploration projects in Nevada. The business model with be to build a portfolio of royalties largely through prospect generation, as well as M&A and exploration.
Strong assets to build on
The combined company will have a market cap of about C$60 million with C$13.5 million in cash. The two cornerstone assets are:
Ermitano: a gold/silver property sold for a 2% royalty to First Majestic, which operates the adjacent Santa Elena mine. First Majestic has been aggressively developing the project with production slated for the first half of 2021.
Silicon, a gold property Renaissance discovered and sold to AngloGold for a 1% royalty. Though Anglo has put out little information, Renaissance believes from indications it could be a multi-million ounce deposit, likely 57 years away from production. Anglo just made the final payment of $2.4 million.
In addition, Evrim brings a royalty of another property, Cumobabi, adjacent to Ermitano, which would follow it into production at a future date, and Renaissance royalties on four early stage projects in Argentina. The project pipeline and joint ventures of both companies in western North America is deep, gold dominant, though there are several copper (or gold-copper) projects in the portfolio as well.
Potential partner in Nevada
Of particular interest is an agreement Evrim has with Yamana regarding its extensive western United States database. Evrim must show properties it finds (whether from Yamana’s database or independently) to Yamana, which has the option to enter into a joint venture on pre-determined and quite attractive terms. Evrim can dilute itself from an equity interest to a royalty. If Yamana declines, then the property reverts to Evrim; the entire alliance ends in 18 months, at which time Evrim maintains a copy of the database
Many of these properties are in Nevada, and Renaissance’s exploration team has deep experience in that state, so the potential for a series of exploration properties, joint ventures and eventual royalties is real.
People, cash, and a plan
Both companies have strong, well-respected personnel. Paddy Nichol will remain CEO of the combined company, and Paul van Eeden the chairman, while Renaissance’s Bob Felder will be senior vice president. The balance sheet is strong, and once the Ermitano royalty kicks in, revenue will cover most of the company’s expenses. The companies expect that by combining they can save around $800,000 in G&A, which is significant for two companies that each have a little over $1 million in G&A. The transaction, requiring votes of both groups of shareholders, is expected to close in late August or September.
If that was the end of the story, it would be strong enough, with two complementary companies, each bringing what the other lacks. But there is much more to this merger: it is intended to lay the foundation for future growth which will include acquiring other projects or companies to build a new royalty generation powerhouse. The larger company will reduce the cost of capital and also enable it to compete in acquisitions.
As CEO Paddy Nichol put it, “We don’t want to be here two years from now with the same assets.” We have high regard and confidence in the skills, integrity and ambition of the management team and with the strong balance sheet, we look forward to the realization of the goal. I suspect we will be holding Evrim/Orogen for a very long time. Evrim is a buy.
Property attractive for acquisition
Cartier Resources Inc. (ECR:TSX.V, 0.195) is advancing its Chimo property in Quebec, with a few to completing a third resource estimate by the end of summer. Currently showing almost 600,000 ounces (indicated), this could increase to close to 2 million ounces, with the planned in-fill drilling intended to upgrade the inferred category into reserves. At that size, given the low capex that would be requiredbecause of facilities in the region, no mill, no leach pad, no shaft to sinkthe project could be of great appeal to one of the many companies operating in the region, or even a new entrant. Cartier’s plan is to sell the project once the updated resource estimate is completed. Its $5 million in the bank is more than sufficient to reach that stage. Cartier is a buy for aggressive investors.
Adrian Day, London-born and a graduate of the London School of Economics, heads the money management firm Adrian Day Asset Management, where he manages discretionary accounts in both global and resource areas. Day is also sub-adviser to the EuroPacific Gold Fund (EPGFX). His latest book is “Investing in Resources: How to Profit from the Outsized Potential and Avoid the Risks.”
Disclosure: 1) Adrian Day: I, or members of my immediate household or family, own securities of the following companies mentioned in this article: Evrim Resources, Midland Exploration, Lara Exploration. I personally am, or members of my immediate household or family are, paid by the following companies mentioned in this article: None. My company has a financial relationship with the following companies mentioned in this article: None. Funds controlled by Adrian Day Asset Management hold shares of the following companies mentioned in this article: All. I determined which companies would be included in this article based on my research and understanding of the sector. 2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. 3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy. 4) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports. 5) From time to time, Streetwise Reports and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Midland Exploration, Lara Exploration, Osisko Royalties and Evrim Resources, companies mentioned in this article.
– The big selloff in the US markets last week (-1600 pts in the Dow Jones) on the comments from the US Fed aligns with previous Fibonacci Price Trigger levels throughout the early portion of 2020 to create a massive Support/Resistance range in the markets according to our research team. It is very likely that the big selloff bar from last week will also establish a minor Support/Resistance range within the price range of that big selloff bar.
One of the key technical components of our Fibonacci Price Modeling system is that it acts as a trend following system, projects key target and reversal levels, and also highlights key trigger levels as price rotates up and down in different time frames. The benefit we derive from this modeling system is that we can interpret the data into various forms of key technical factors for our friends, followers, and members.
Although this YM Daily chart, below, may be a bit complicated, pay attention to the BLUE SHADED RECTANGLE between 25,600 and 26,500. Additionally, pay attention to the heavy MAGENTA LINE near 26,000. This rectangle and the magenta line are derived from Fibonacci Trigger levels generated by our Fibonacci Price Modeling system.
You can see these Trigger Levels as GREEN and RED horizontal lines drawn just below new price peaks or just above new price bottoms. Fibonacci Price Theory is based on tracking price peaks and troughs in a process as price attempts to trend higher or lower. Our Fibonacci Price Modeling system attempts to adapt to price variances using a modified AI technology and attempts to highlight projected Trigger Levels and future potential Target Levels with each new price rotation.
Our researchers believe the BLUE RECTANGLE range will act as a major price support/resistance level after the big selloff bar last week. This price range, totaling almost 1000 points, is likely to prompt volatile price rotation near or within this range as price attempts to either breakout to the upside or breakdown into a new Bearish trend.
If the price moves lower, below the 25,500 level, there are very few prior Fibonacci Trigger levels that offer support on the way down. One, near 23,850, and additional deeper Trigger Levels near 20,000 to 20,850 are the only deeper reference points recently. Thus, our researchers believe any price breakdown below 25,500 could prompt a very deep and fast price correction in the markets – setting up a potential double-bottom type of pattern.
YM – DOW JONES 60 MINUTE CHART
This 60 Minute YM chart, generated about 70 minutes after the Daily chart, above, clearly shows how price reacted near the upper range of the BLUE Fibonacci Price Channel. Almost immediately after attempting to breach the upper range of the support channel, the price collapsed back into the channel and wiped out close to 300+ points very quickly.
Our research team believes the 26,000 will continue to act as a key price level going forward. The upward sloping price channel line, drawn as a LIGHT SKY-BLUE LINE through the recent downside price rotation, is another key price channel supporting the current market. Once both of these levels are breached to the downside, there is very little support to be found before reaching the 23,850 level.
As we’ve been warning our friends and clients, this is the time to stay very cautious with your trades as volatility will likely continue to be elevated and bit price rotations are likely as we head into Q2 earnings season. Everyone wants to see a strong recovery in the US markets and speculative traders are pushing in that direction. The reality of the situation may be that we see a longer-term recovery taking place over the next 6 to 12+ months.
Right now, the YM price is still above the heavy Magenta support level. We need to watch price activity as this level becomes critical for the price to attempt any future upside price moves. If the price falls below this level, then a deeper price breakdown may be initiating.
As a technical analyst and trader since 1997, I have been through a few bull/bear market cycles in stocks and commodities. I believe I have a good pulse on the market and timing key turning points for investing and short-term swing traders. 2020 is an incredible year for traders and investors. Don’t miss all the incredible trends and trade setups.
Subscribers of my Active ETF Swing Trading Newsletter had our trading accounts close at a new high watermark. We not only exited the equities market as it started to roll over in February, but we profited from the sell-off in a very controlled way with TLT bonds for a 20% gain. This week we closed out SPY ETF trade taking advantage of this bounce and entered a new trade with our account is at another all-time high value.
Ride my coattails as I navigate these financial markets and build wealth while others watch most of their retirement funds drop another 35-65% during the rest of this financial crisis going into late 2020 and early 2021.
If you have any type of retirement account and are looking for signals when to own equities, bonds, or cash, be sure to become a member of my Passive Long-Term ETF Investing Signals which we are about to issue a new signal for subscribers.
Chris Vermeulen Chief Market Strategies Founder of Technical Traders Ltd.
Eli Lilly shares set a new 52-week high price after the company reported that its Verzenio® (abemaciclib) significantly reduced the risk of cancer returning in people with high risk HR+, HER2- early breast cancer.
Eli Lilly and Co. (LLY:NYSE) today announced “Verzenio® (abemaciclib) in combination with standard adjuvant endocrine therapy (ET) has met the primary endpoint of invasive disease-free survival (IDFS), significantly decreasing the risk of breast cancer recurrence or death compared to standard adjuvant ET alone.”
The firm advised that “the results are from a pre-planned interim analysis of the Phase 3 monarchE study making Verzenio the only CDK4 & 6 inhibitor to demonstrate a statistically significant reduction in the risk of cancer recurrence for people with high risk hormone receptor-positive (HR+), human epidermal growth factor receptor 2-negative (HER2-) early breast cancer.”
Maura Dickler, M.D., VP of oncology, late-phase development, Lilly Oncology, stated, “When a person is diagnosed with high risk early stage breast cancer, they strive to do everything in their power to prevent a recurrence. And as clinicians, we have the same goal…monarchE was intentionally designed for people whose breast cancer is at a high risk of returning. We are incredibly excited by the results of monarchE and that we can potentially offer a new treatment option for patients with high risk HR+, HER2- early breast cancer. This would not have been possible without the tremendous commitment from the people who participated in this trial.”
The company noted that breast cancer is the most common cancer among women worldwide and explained that even though there has been a lot of progress in treating breast cancer, about 30% of those diagnosed with HR+, HER2- early breast cancer are at risk of their cancer returning.
Lilly Oncology’s President Anne White commented, “We’re proud that Verzenio has already treated tens of thousands of people around the world who are living with HR+, HER2- advanced breast cancer…And now Verzenio in combination with endocrine therapy has demonstrated positive results in people with high risk HR+, HER2- early breast cancer a major milestone with the potential to change the paradigm of how early breast cancer is treated and a first for the CDK4 & 6 inhibitor class. The fact that these results were achieved early, at the interim analysis, is also exciting because it will help us speed this innovation to people who need it. We look forward to submitting these data to regulatory authorities before the end of 2020.”
The company indicated that the monarchE trial has a completion date estimated for June 2027. The firm advised that it is a Phase 3, multicenter, randomized trial that enrolled 5,637 patients with high risk, node positive, HR+, HER2- early breast cancer. The primary objective of the trial was listed as “invasive disease-free survival, which in monarchE is defined as the length of time before any cancer comes back or death. Secondary objectives include distant relapse-free survival, overall survival, safety, pharmacokinetics and health outcomes.”
The firm stated that “Verzenio® (abemaciclib) is an inhibitor of cyclin-dependent kinases (CDK)4 & 6, which are activated by binding to D-cyclins. In estrogen receptor-positive (ER+) breast cancer cell lines, cyclin D1 and CDK4 & 6 promote phosphorylation of the retinoblastoma protein (Rb), cell cycle progression, and cell proliferation.”
Eli Lilly began the day with a market capitalization of around $135.4 billion with approximately 956.4 million shares outstanding. LLY shares opened more than 10.00% higher today at $156.32 (+$14.80, +10.46%) over yesterday’s $141.52 closing price and reached a new 52-week high price this morning of $167.43. The stock has traded today between $155.00 and $167.43 per share and is currently trading at $163.56 (+$22.07, +15.60%).
Disclosure: 1) Stephen Hytha compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. He or members of his household own securities of the following companies mentioned in the article: None. He or members of his household are paid by the following companies mentioned in this article: None. 2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees. 3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. 4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports. 5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. 6) This article does not constitute medical advice. Officers, employees and contributors to Streetwise Reports are not licensed medical professionals. Readers should always contact their healthcare professionals for medical advice.
Namibia’s central bank lowered its benchmark repo rate for the fourth time this year, saying this decision balances the need for further monetary stimulus in the face of the pandemic-induced weakness in the economy against the importance of not undermining savings and investment decisions. The Bank of Namibia (BON) cut its rate by another 25 basis points to 4.0 percent and has now cut it by 250 points this year, less than the South African Reserve Bank (SARB), which has cut its key rate by 275 points. Namibia pegs its Namibian dollar to South Africa’s rand at a one-to-one rate, which means it typically tracks changes in South Africa’s monetary policy. “The MPC (monetary policy committee) is of the view that at 4.00 percent the repo rate is appropriate to support domestic economic activity while at the same time safeguarding the one-to-one link between the Namibia dollar and the South African rand,” BON said. As of May 31, Namibia’s stock of international reserves had risen to N$33.7 billion from 33.0 billion on March 31, enough to cover 5.1 months of imports. Economic activity in Namibia contracted in the first four months of the year as compared with last year, affecting mining, manufacturing, wholesale and retail trade, transport and tourism sectors, and BON said it expects the economy to contract further in 2020. In the first quarter of this year Namibia’s gross domestic product shrank 2.59 percent from the previous quarter for an annual contraction of 0.8 percent, while average growth in private sector credit expansion (PSCE) slowed to 5.8 percent in the first four months, down from 6.4 percent year-on-year. Last year Namibia’s economy contracted by 1.1 percent due to severe drought and weak mining activity and the government has forecast a 6.6 percent contraction this year. Inflation in Namibia rose to 2.1 percent in May from 1.6 percent in April and is projected to average around 2 percent this year, BON said, adding the average inflation rate in the first 5 months of this year was 2.1 percent as compared with 4.4 percent in the same period last year. Today’s policy decision is the first under the central bank’s new governor, Johannes Gawaxab, who took over on June 1 as the bank’s third governor since its founding in 1990. Gawaxab succeeded Ipumbu Shiimi, who served for 10 years as BON governor and was appointed finance minister in March. In addition to the role of governor, Gawaxab will also chair the bank’s board of directors. On assuming his job, Gawaxab was quoted as saying he believes the bank’s mandate is more than just monetary policy and financial stability but also on delivering on an economy that provides prosperity to Namibia.
New Zealand current account deficit decline bullish for NZDUSD
New Zealand’s current account deficit narrowed in the first quarter: the current account deficit narrowed to $1.57 billion in Q1 from 2.77 billion in Q4 when a decline to 1.59 billion was expected. This is bullish for NZDUSD.
