Weekly market brief - 12 February 2026

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* The golden rand & the softer greenback
* Rand pulls rank
* Local mining production disappoints
* NFP surprises the markets
* EU investor confidence improves

Currency Outlook

  • “President Cyril Ramaphosa's 2026 State of the Nation Address faces challenges in presenting a credible account of progress amid serious domestic setbacks. While the Government of National Unity has delivered fiscal gains, grey list removal, a credit rating upgrade, inflation target adjustment, network industry reforms, Operation Vulindlela Phase Two, and Durban port improvements, these achievements are overshadowed by Johannesburg's acute water crisis which highlight chronic infrastructure decay, funding shortages, skills gaps, and municipal mismanagement. The crisis poses significant public health risks, surpassing electricity disruptions in severity. For the address to carry weight, it must substantively address the Johannesburg water crisis and Western Cape drought response, alongside South Africa's shifting geopolitical stance. The move away from non-alignment toward adversarial relations with the United States, while deepening ties with Russia and Iran, risks trade relations with key partners. An evasive or superficial speech will undermine its constructive potential.” (Source: Investec Morning Commentary dated 12.02.2026)
  • High court to hear Godongwana’s bid to block EFF’s fuel levy case. Minister says the challenge is procedurally irregular and may have fiscal implications.
  • South Africa’s business leaders have warned that Eskom’s revised unbundling plans jeopardise billions in national grid investments. The leaders have pressured Ramaphosa to weigh business concerns against supporting his electricity minister, Kgosientsho Ramokgopa, who approved the controversial strategy in December.
  • South Africa’s government plans to set up a new company to manage its vast property portfolio, worth an estimated R155 billion (USD 9.75 billion).
  • The prevalence of foot-and-mouth disease in KwaZulu-Natal has risen sharply, affecting an estimated 70 to 90% of herds, and desperate farmers say they are witnessing their herds perish, their incomes dry up, and their way of life disintegrate before their eyes.
  • Nersa corrects R54 billion mistake: tariff hikes increased for next two years. South Africa’s energy regulator, Nersa, has confirmed that Eskom’s average tariffs will rise by 8.76% this year, an increase from the 5.36% that was initially announced over a year ago. Eskom’s new rates, stemming from a revenue re-evaluation to correct Nersa’s earlier errors, will take effect on April 1 for direct customers and July 1 for municipal customers.
  • “The rand is trading around R15.8600/USD, having consolidated below the R15.90/USD threshold following a tempered USD retreat driven by fiscal worries and subdued labour market revisions that curb yield declines. The rand has firmed modestly against the USD whilst holding steady versus majors amid improved risk appetite supporting EM peers. Technically, support on the downside now eyes prior lows towards R15.64/USD, aligned with the day’s projected range floor, whilst resistance on the topside caps at R16.00/USD. Near-term bias tilts appreciative for the ZAR, catalysed by persistent USD vulnerabilities; volatility persists, however, as positioning favours EM inflows.” (Source: Investec Morning Commentary dated 12.02.2026)

Local Data

  • The SARB's gross reserves increased to USD 80.19 billion in January, from USD 75.89 billion in December.
  • Mining production for December increased with 2.50% y/y, up from a decline of 2.7% y/y in November.
  • Manufacturing production decreased by 1.4% y/y in December, this follows a decrease of 1.0% y/y in November.

Interest Rate Outlook

  • January's MPC decision resulted in the repo rate remaining unchanged at 6.75%. Expectations for a cut were evenly split between those anticipating a hold and those anticipating a cut. This decision is more aligned with the SARB's efforts to keep inflation well contained around 3% and monetary policy remains restrictive.
  • The next rate decision of the Monetary Policy Committee will be announced on 26 March 2026.

International News

  • US
    • U.S. non-farm payrolls (NFP) came in well above expectations in January, rising by 130,000 (almost double expectations), compared to a downwardly revised increase of 48,000 in December (previously a 50,000 increase).
    • Jobless claims came in below expectations at 227,000 this week, from 231,000 last week.
    • U.S. retail trade sales stalled unexpectedly in the final month of last year.
    • The U.S. NFIB small business optimism index softened somewhat in January.
  • Euro zone
    • The Eurozone Sentix investor confidence index for February overshot expectations, increasing to 4.2, from -1.8 in January.
    • ECB President Christine Lagarde said the central bank remains focused on keeping inflation under control as part of its broader effort to strengthen the Eurozone economy.
    • ECB wage tracker highlighted that wage growth in the region is expected to increase in H2:26, supporting the ECB's monetary policy view for rates to remain steady.
  • United Kingdom
    • UK GDP showed an increase of 0.1% q/q in Q4:25, following a 0.1% q/q expansion in Q3:25.
    • The British Retail Consortium (BRC) retail sales monitor ticked up in January.
  • China
    • China’s Consumer Price Inflation (CPI) cooled in January while producer price deflation continued, showing the underlying weakness in domestic demand and an essential challenge for policy makers looking to shore up an uneven economic recovery.
    • The Producer Price Inflation fell 1.4% y/y compared with the 1.9% y/y fall in December, with the downturn easing for the second month but extending a years-long deflationary trend in the world's second-biggest economy that policymakers are battling to overcome.
    • Chinese regulators have instructed banks to reduce their holdings of U.S. Treasury bonds.
  • Australia
    • Australian business conditions dipped slightly in January as sales and profits slowed a little, while cost pressures were the lowest since 2001 in a hopeful sign for future inflation.
    • A survey from National Australia Bank showed its business conditions eased 2 points to +7 points, reversing a gain made in December and business confidence rose 1 point to +3.
  • Japan
    • The corporate goods price index (CGPI) slowed 2.3% y/y in January from a 2.4%y/y gain in December, matching analysts’ expectations
    • Prime Minister Takaichi's Liberal Democratic Party secured 316 of 465 lower house seats on Sunday, marking the largest post-war single-party victory.

Precious Metals

  • Gold traded within a relatively firm range this week, supported at times by a softer U.S. dollar but weighed down by stronger-than-expected U.S. economic data, which tempered expectations of near-term monetary easing.
  • The metal began the week at USD 4,959.57/oz and quickly reclaimed the USD 5,000/oz level, closing Monday at USD 5,064.49/oz, helped by dollar softness and anticipation of key economic releases later in the week.

Base Metals

  • Copper consistently held above USD 13,100/t, underpinned by dollar weakness and firmer risk appetite, while gains were capped by subdued demand and increasing stockpiles in China.
  • The Lunar New Year break, starting this weekend, is expected to significantly pressure near-term demand, with activity likely to recover later in February and potentially only normalising in early March.

Oil

  • Oil remained range-bound this week, influenced by geopolitical developments and adjustments to demand expectations.
  • According to the EIA, U.S. crude oil inventories rose by 8.5 million barrels to 428.8 million in the week ended February 6, the largest increase in a year and far above expectations for a 0.8-million-barrel build.