SOUTH AFRICA: Fuel Levy Hike Kicks In After EFF's Court Bid To Stop It Fails
Jun-04 06:42
- The Western Cape Division of the High Court denied a request by the Economic Freedom Fighters (EFF) to interdict the implementation of the fuel levy hike and the measure will take effect today. It was announced by Finance Minister Enoch Godongwana in an effort to plug the fiscal hole generated by the removal of a planned VAT increase from the 2025 National Budget. The fuel levy hike coincides with the regular adjustment in prices, which will drop slightly, moderating the impact on consumers.
- Floyd Shivambu was dismissed as Secretary General of the uMkhonto weSizwe (MK) party and demoted to backbenches over his controversial visit to Malawi for a meeting with fugitive pastor Shepherd Bushiri and subsequent claims that it was authorised by party leader Jacob Zuma. Shivambu's leadership style was under criticism since he jumped ship from the EFF, where he served as deputy leader, and was parachuted to a senior position in the MK party nine months ago.
- SARB's David Fowkes said that 'there is a really amazing opportunity right now' to lower the central bank's inflation target, 'surely the best opportunity we're ever going to get.' His colleague Chris Loewald added that talks with the Treasury are ongoing and 'we're at the right place now to finalise those recommendations and get agreement on them.'
- Business Tech reported that Eskom is on the threshold of being forced into loadshedding, with unplanned outages averaging 13,871MW between May 23-29 against guidance in the utility's Winter Outlook noting that power cuts will not be necessary if the figure stays below 13,000MW.
- S&P Global PMI will be out at 08:15BST/09:15SAST.
- BER Business Confidence will be published at 11:00BST/12:00SAST.
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Historical bullets
EQUITY TECHS: E-MINI S&P: (M5) Clears The 50-Day EMA
May-05 06:35
- RES 4: 5865.42 200-dma
- RES 3: 5837.25 High Mar 25 and a bull trigger
- RES 2: 5773.25 High Apr 2
- RES 1: 5724.75 High May 2
- PRICE: 5674.25 @ 07:24 BST May 3
- SUP 1: 5511.99 20-day EMA
- SUP 2: 5355.25/5127.25 Low Apr 24 / 21 and a key support
- SUP 3: 4996.43 76.4% retracement of the Apr 7 - 10 bounce
- SUP 4: 4832.00 Low Apr 7 and the bear trigger
The latest recovery in the e-mini S&P reinforces current bullish conditions.The contract has traded through the 50-day EMA, at 5620.87. A continuation of the bull phase would expose 5837.25 next, the Mar 25 high and a bull trigger. It is still possible that the entire rally since Apr 7 is a correction. A reversal lower would signal the end of this corrective phase and expose initially, support at 5127.25, the Apr 21 low.
MNI: SWISS APR CPI +0% M/M, +0% Y/Y
May-05 06:30
- MNI: SWISS APR CPI +0% M/M, +0% Y/Y
EUROPEAN INFLATION: Swiss April CPI Below Consensus
May-05 06:30
Swiss CPI inflation printed below consensus at 0.0% in April (vs 0.2% cons; 0.3% prior), and 0.0% M/M. Core CPI also printed below consensus, at 0.6% Y/Y (vs 0.8% cons; 0.9% prior).
- This means inflation started off Q1 well below the 0.3% Y/Y SNB expectation for this quarter. Note that Chairman Schlegel has mentioned in the last press conference that negative inflation would not be totally outside of expectations if it only persists for single months (as opposed to quarters, the SNB's reference period for their official forecasts).
- The main categories appear to indicate that the headline drop vs March was relatively broad-based on first sight:
- Domestic 0.8% vs 1.0% prior
- Imported -2.5% vs -1.7% prior
- Services 1.4% vs 1.6% prior
- Goods -2.0% vs -1.6% prior
- Energy and fuels -7.8% vs -7.1% prior
- Housing rental inflation did not see its quarterly price update this month (due May).
