Local CPI 6.3% for May (lowest since April 2022) from 6.8% in April and vs expected 6.5%. A very good number and we should see June below 6% as June last year was the first +7% in this cycle at 7.4%. Simple base effect should put some serious pressure on inflation over the next few months.

So is inflation largely over locally? Probably.

Can we start talking about when the MPC starts cutting rates? The next MPC rate announcement is July, the day after we get June inflation and we’ll see that the governor says. But cuts are maybe fourth quarter fo this year, at soonest. Standard Bank thinks another 0.25% hike later this year and consensus is cuts only starting next year.

Simon Shares

• UK core inflation rises from 6.8% to 7.1% and CPI 8.7%. They are in trouble.
• Standard Bank (JSE code: SBK) trading update. Very much two parts, bad debts are ugly and profts are lookign great. They also expect a 0.25% rate increase in the second half of the year?
• Afrimat (JSE code: AFT) deal to buy Lafarge for ±R1billion. String vertical intergration and potential to boost profits to essentially be paying around a 3x PE. They also say that it looks lie constructions has bottomed in 2022.
• Omnia (JSE code: OMN) results. Agri struggling with margin pressure, ining booming while chemicals slips. But overall good and stock si cheap.
• Transaction Capital (JSE code: TCP) secures funding for Gomo. Securing the capital was a major market concern and now they have a bank using their balance sheet and they earn a margin. Good deal but market still selling.
• How to Diversify Your Commodity Exposure With the PICK ETF
• Dividend portfolio paying monthly

Simon Brown

Thursdays are all about hard-core investing and trading with Simon Brown’s famous JSE Direct podcast. JSE Direct started life on ClassicFM in July 2008 and became a podcast in 2011. Every week Simon shares his views on the state of global economies, individual shares and events moving markets.

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JSE Direct is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.