The wage talks themselves impose significant uncertainty over third quarter production.
Manufacturing output increased by a robust.6 month-on-month in May following growth.4 in April, mirroring the substantial improvement over recent months in the Barclays manufacturing purchasing managers index (PMI).
The outlook is improving: not only is economic activity increasing inflationary pressure and inflation expectations are declining.Among the retail categories, general dealers recorded an increase.5 on the year, clothing and textile.0, hardware and paint.5 and other retailers.4.The stagflation conditions which afflicted markets earlier in the year, a combination of rising inflation at the same time as slowing economic growth, appear to be lifting.The rands strong rally has been boosted since the Brexit vote.Gold has developed an inverse head and shoulders pattern, which indicates further upward momentum and a test of the 1 400 target level.The US dollar index is testing a major 30-year resistance line, which if broken will pave the way for further strong gains in the currency.
Meanwhile, retail sales increased in May by a solid.4 on the month its fastest pace since November 2012.On a year-on-year basis manufacturing growth increased from.1 in April.0 the fastest rate since July 2015.A further negative signal is that the Dow Jones Transport Index, traditionally a lead indicator for the broader market, is underperforming the broader index.The data is consistent with second quarter GDP growth.0 quarter-on-quarter annualised.The European a woman in for search a 3 Central Bank, Bank of England and Bank of Japan are expected to announce further interest rate cuts and increased quantitative easing.overberg Asset Management (OAM) is an Authorised Financial Services Provider.Having decelerated for three straight months CPI is expected to increase moderately from.1 in May.3 in June according to consensus forecast.Any opinions, forecasts or estimates herein constitute a judgement as at the date of this Report and should not be relied upon.Overberg specialises in the private management of local and global discretionary portfolios as well as pension products.


[L_RANDNUM-10-999]