Bitcoin rocks stocksBy Arnaud Masset
This week has been good not only to cryptocurrencies but even more so to investors in blockchain. DigitalX – an Australian company that provides ICO advisory, blockchain consulting and blockchain-related software – surged almost 60% on Monday-Tuesday. Block.One Capital, developer of the EOS platform, climbed 43% after it secured a substantial investment from Peter Thiel, PayPal’s co-founder, and Jihan Wu, Bitmain’s co-founder. Global Blockchain Technology, Hive Blockchain Technology and Creative Technology rose 30%, 18% and 12% respectively.
With the entire crypto market still in limbo, valuations of companies having clear blockchain-related business models are very interesting. Still, investors should remember this is a nascent industry and not all bets will pay. The road ahead is long and bumpy but potential reward is huge. See Swissquote’s Blockchain Certificate (BLOCHU) for details.
South Africa to hold rates, thanks to dollar boostBy Vincent-Frédéric Mivelaz
The South African Central Bank (SARB) is expected to keep its Repo interest-rate unchanged at today’s monetary policy meeting. South Africa’s economy is recovering from the tumult of the Jacob Zuma regime and his resignation in February. However, rumours of a pending power-grab by Zuma supporters within the governing African National Congress party are causing uncertainty. Domestic consumption and manufacturing are progressing, so SARB is expected to give the economy some relief, maintaining its Repo at 6.5% (unchanged since 28 March 2018), despite inflation of 4.6%. Currently at 13.3638, USD/ZAR is expected to strengthen after the SARB announcement, approaching 13.50.
The climb is thanks to a dollar surge following testimony of Federal Reserve Bank Chairman Jerome Powell to the US Congress. His 2-day discussion confirmed that the US economy is growing at a faster pace than previously anticipated, and that Q2 2018, despite escalating trade sanctions, remained the strongest in the year. This means money tightening would not be a problem for the economy. The announcement boosted the dollar, especially against emerging market currencies.