The Daily Economic and Business News Update, Friday, 14 June 2019

Group Corporate Strategy ZB Financial Holdings Limited 1st Floor, 21 Natal 21 Natal Road, Belgravia, Box 3198, Harare

Tel: +263 (0)8677002001

Foreign Currency, Money, Equities & Commodities Markets Overview

Foreign Currency Markets International Stock Markets Year–On-Year Inflation Rates Currency 14-06-19 13-06-19 Index 13-06-19 12-06-19 Change Country Rate USD/RTGS 6.0000 6.0000 Dow Jones 26,106.77 26,004.83 +0.39% Zimbabwe 75.86%Apr USD/ ZAR 14.8473 14.9121 NASDAQ 7,837.13 7,792.72 +0.57% South Africa 4.4%Apr Apr EUR/ USD 1.1276 1.1298 FTSE All Share 4,022.84 4,024.80 -0.05% Malawi 9.1% GBP/USD 1.2673 1.2681 Nikkei 225 21,101.86 21,014.55 +0.42% Zambia 16 8.0% May USD /BWP 10.9409 10.8932 DAX 12,169.05 12,115.68 +0.44% Botswana 2.5% Apr Old Mutual Implied Exchange Rates Mozambique 2.42%May Currency 13-06-19 12-06-19 May 2019 Apr 2019 Mar 2019 Feb 2019 Namibia 4.1% May USD/ZWL 9.4462 9.4034 9.7191 6.1291 5.4150 4.4057 Kenya 5.49% May ZWL/ZAR 1.5639 1.5914 1.2609 1.2938 1.3073 3.1868 Ghana 9.5% Apr Regional Stock Markets Nigeria 11.37%Apr Index 13-06-19 12-06-19 Change Interest rates 13-06-19 Brazil 4.66%May ZSE Industrial Index 668.49 646.85 +3.35% SARB Prime Rate 10.25% China 2.7%May ZSE Mining Index 248.51 248.51 0.00% BOB Prime Rate 5.00% Canada 2.0%Apr ZSE All Share 200.22 193.81 +3.31% LIBOR One Month 2.411% Germany 1.4%May JSE All Share 58,697.63 58,710.55 -0.02% LIBOR Three Month 2.428% Australia 1.3%Apr Ghana SE-CI 2,414.11 2,422.68 -0.35% LIBOR One Year 2.333% U.K. 2.1%Apr Nairobi All Share 150.44 150.46 -0.01% Federal Discount Rate 1.000% Japan 0.9% Apr Nigeria All Share 30,029.15 N/A N/A Federal Prime Rate 3.500% U.S.A. 2.0%Apr Last Daily YTD YTD Issued 13-06-19 12-06-19 Traded Change Change Change Zimbabwe Market Cap. ZSE Counter (US$) (US$) (US$) (US$) (US$) (%) Shares (US$) ZB Financial Holdings 0.49 0.49 0.49 0.000 +0.13 +36.11% 175,190,642 85,843,414.58 First Capital Bank Limited 0.092 0.08 0.08 +0.012 +0.032 +53.33% 2,156,260,176 198,375,936.19 CBZ Holdings Limited 0.45 0.45 0.45 0.000 +0.3 +200.0% 687,231,691 309,254,260.95 Econet Wireless Zimbabwe 1.9509 1.7448 1.7448 +0.2061 +1.0509 +116.8% 2,590,577,000 5,053,956,669.30 FBC Holdings Limited 0.505 0.505 0.505 0.000 +0.305 +152.5% 671,949,927 339,334,713.14 Fidelity Life Assurance 0.11 0.11 0.11 0.000 0.000 0.00% 108,923,291 11,981,562.01 Get Bucks 0.12 0.12 0.12 0.000 +0.083 +224.3% 1,093,567,251 131,228,070.12 NMBZ Holdings Limited 0.28 0.275 0.275 +0.005 +0.19 +211.1% 392,954,830 110,027,352.40 Old Mutual Plc 14.0032 14 14 +0.0032 +9.3032 +197.9% 64,173,594 898,635,671.50 First Mutual Holdings 0.18 0.18 0.18 0.000 -0.015 -7.69% 690,143,060 124,225,750.80 Mashonaland Holdings 0.04 0.04 0.04 0.000 +0.0054 +15.61% 1,859,073,947 74,362,957.88 ZSE Gainers ZSE Losers 13-06-19 Previous 13-06-19 Previous Counter (US$) (US$) Change (%) Counter (US$) (US$) Change (%) Proplastics 0.3768 0.3200 +17.75% FCB 0.0920 0.0800 +15.00% Masimba 0.1205 0.1054 +14.33% African Sun 0.4497 0.4000 +14.23% International Commodity Prices +0.042% ZSE Market Data Index 13-06-19 12-06-19 Commodity 13-06-19 12-06-19 Jan 19 Jan 18 Turnover Value ($m) 4.1540 6.5070 Gold (US$/oz) 1,341.90 1,333.10 1,283.50 1,317.10 Foreign Buys ($m) 2.4357 0. 2814 Platinum (US$/oz) 810.00 810.00 792.00 942.00 Foreign Sales ($m) 1.4131 2.4453 Silver ( US$/oz) 14.885 14.750 15.470 17.150 Market Cap ($m) 26,572.99 25,579.20 Palladium ( US$/oz) 1,428.00 1,390.00 1,252.00 1,086.00 YTD Change (Market Cap) +38.48% +33.30% Brent Crude Oil (US$/barrel) 61.31 59.97 53.80 66.55

Disclaimer: This document may be legally privileged and/or confidential and has been prepared for informative purposes only. No liability whatsoever for any loss howsoever arising from the use of this review or its contents or otherwise arising in connection therewith shall be accepted by ZB Financial Holdings, any of its directors, employees, or associates. Any person who makes use of this document shall be solely responsible for making his or her own TheSundayMail investigation of the issues discussed in this report. ZB Financial Holdings accepts no responsibility whatsoever for the accuracy or completeness of the information contained in this document.

-Page 1- Group Corporate Strategy ZB Financial Holdings Limited 1st Floor, 21 Natal 21 Natal Road, Belgravia, Box 3198, Harare

Tel: +263 (0)8677002001

Local Business News

1. Government’s fiscal consolidation measures and other initiatives introduced into Zimbabwe’s economic programmes should see prices of goods starting to drop from next month, Finance and Economic Development Minister Mthuli Ncube has said. In a pre-recorded governors’ Statement released in Malabo, Equatorial Guinea during the 54th Meeting of the Boards of Governors of the African Development Bank (AfDB) and the 45th Annual Meeting of the African Development Fund underway at Sipopo Conference Centre, Prof Ncube said reforms introduced under the Transitional Stabilisation Programme (TSP) were starting to bear fruit. (Herald)

2. The country’s biggest banking group by assets and deposits, CBZ Holdings Limited, has secured US$40 million export-oriented loan facility from the Africa Export-Import Bank (Afreximbank) that will assist local companies. The facility will assist companies that are only into export businesses as the country targets an export-led economic growth and boost foreign currency earnings. Group chief executive officer Blessing Mudavanhu said this was a positive sign as it showed Zimbabwe still has room to get external funding at a time its risk profile is perceived high with other multi-lateral lenders averse to extend credit lines to the country. (Herald)

3. Government has earmarked the 2% intermediated money transfer tax (IMT), which has performed above target since introduction last year for infrastructure development among other key economic enablers. Further, the Government indicated that airtime levy, which has also performed well consistently and raked in $11.4 million in April, had been earmarked for medical equipment. A report by the African Development Bank (AfDB) says that Zimbabwe needs US$26 billion to bridge its infrastructure gaps, which entails deficiencies in services associated with roads, water and sanitation, transport, electric power and ICTs. And since its introduction last year, the transactions tax, which has raised more than half a billion dollars, has been used for other critical things that include education and safety nets. (Herald)

-Page 2- Group Corporate Strategy ZB Financial Holdings Limited 1st Floor, 21 Natal 21 Natal Road, Belgravia, Box 3198, Harare

Tel: +263 (0)8677002001

4. The Zimbabwe Miners Federation (ZMF) has called on state gold buying entity, Fidelity Printers and Refineries (FPR), to join hands with the miners’ representative body and capitalise on frequent gold rushes that have a potential to boost deliveries to the gold buyer. The call was made by ZMF secretary general Morgan Mugawu, when he made a presentation at a meeting between the two parties that sought to foster a mutually beneficial relationship that could boost gold deliveries as well as see miners getting value for their deliveries. Small scale miners, who fall under the ambit of ZMF are the country’s largest gold producers, accounting for the largest chunk of deliveries to FPR ahead of their better equipped counterparts in the primary production sector. With Government expecting to build on last year’s record gold deliveries of 33.2 tonnes to 40 tonnes this year and ultimately at least 100 tonnes per year by 2023, the small scale mining sector is now a strategic investment destination. (Herald)

5. Sole state gold buying entity, Fidelity Printers and Refineries (FPR) will this month set up a gold production taskforce in conjunction with producers of the yellow metal as it seeks producer input that will inform payment modalities to curb rampant leakages. Zimbabwe last year produced a record 33.2 tonnes of the yellow metal and Government has set this year’s target at 40 tonnes. The target is to produce 100 tonnes per year from 2023 onwards. Gold production and mining in general is one of the key pillars on which government hopes to anchor Vision 2030 by which Zimbabwe should be an upper middle income earning economy. (Herald)

6. Defunct Steel manufacturer Ziscosteel, is set to get a new board of directors after Government retired the entire old board that had been in office for more than a decade. Industry and Commerce Minister Nqobizitha Mangaliso Ndlovu, confirmed that the board led by Mr Nyasha Makuvise had overstayed its term of office and has been retired, paving way for the appointment of a new board. “We have retired the entire old board. The new one is expected anytime soon. In fact, I already have the names and am awaiting approval by President Emerson Mnangagwa,” said Ndlovu. (Herald)

-Page 3- Group Corporate Strategy ZB Financial Holdings Limited 1st Floor, 21 Natal 21 Natal Road, Belgravia, Box 3198, Harare

Tel: +263 (0)8677002001

7. Government plans to improve the interconnectivity of the National Railways of Zimbabwe (NRZ) with other countries in the region to improve the parastatal’s market share and revenue, a Cabinet Minister said yesterday. In an interview after touring NRZ infrastructure and workshops in Bulawayo, Transport and Infrastructural Development Minister Joel Biggie Matiza said this was part of the parastatal’s turnaround strategy. (Herald)

8. Financial Securities Exchange Limited (Finsec) will now start admitting unit trusts as it broadens channels by which investors can use as a hedge against obtaining inflationary pressures. The unit trusts will be open for both institutional and retail investors, although the main target is the latter as the country is getting more enlightened on safe investment and savings methods. Finsec general manager Garikayi Munema, said given the obtaining economic volatility characterised by inflationary pressures, unit trusts are a safe investment haven for small-scale investors as funds will be managed by experienced fund managers. (Herald)

9. Zimpapers has launched a dial-a-number concept aimed at delivering newspapers to its customers at their homes in Harare and Bulawayo during weekends. Zimpapers circulation manager Liz Mushonga yesterday said customers dial their given numbers to order a weekend paper, especially during this winter period. She said the order cut-off time is 0800 hours. “Customer pays using our given number via EcoCash, then sends proof of payment and location via WhatsApp to order their required papers(s). The expected result is an increased uptake of our weekend papers by those who may not want to leave their houses in search of papers, especially on a cold winter morning,” she said. The company is set to start with Saturday Herald and Chronicle, and Sunday Mail and Sunday News. Mushonga added that they are running a pilot project this month. (Herald)

-Page 4- Group Corporate Strategy ZB Financial Holdings Limited 1st Floor, 21 Natal 21 Natal Road, Belgravia, Box 3198, Harare

Tel: +263 (0)8677002001

10. There was mayhem at Agribank Mvurwi and Voedesel Tobacco Company on Wednesday afternoon after tobacco farmers failed to access their hard-earned money supposedly transferred into their bank accounts by the tobacco firm. Scores of farmers started singing revolutionary songs at Agribank as they marched towards the Voedsel Company offices, where they were baying for the management’s blood and the managers had to lock themselves inside the premises. Efforts to contact Voedsel management proved futile. Some of the farmers hurled insults at the management, while others kept on singing and dancing to revolutionary songs. (NewsDay)

11. Ariston Holdings Limited (AHL) says Cyclone Idai damaged the company’s plantations in the Eastern Highlands, with early indications suggesting that the damage could be worth US$1.5 million. "In March 2019, the group’s estates located in Chimanimani and Chipinge were affected by tropical Cyclone Idai. The damage on the estates varied substantially, with the greatest effects being experienced at Roscommon Estate which is located in Chimanimani,” chief executive Paul Spear said in a statement accompanying the company’s half year results. “While there was no loss of life, damage was incurred on infrastructure, including roads, bridges, irrigation equipment, housing and to a lesser extent, orchards. (NewsDay)

12. Listed manufacturer and distributor of farming implements, Zimplow, says its revenue grew by 86% to $29.8 million in the first five months of 2019, driven by an improvement in volumes across the group’s business units. Zimplow operates five business units, namely Barzem, Mealie Brand, Powermec, CT Bolts and Farmec. In a trading update at the company’s annual general meeting, chief executive Vimbayi Nyakudya said the group’s operating profit went up by 784% to $13.4 million during the five months to May, driven by growth in volumes and impact of the exchange rate movement towards the end of May 2019 on the group’s foreign-denominated monetary assets. The group’s Mealie Brand performed well despite the drought that affected

-Page 5- Group Corporate Strategy ZB Financial Holdings Limited 1st Floor, 21 Natal 21 Natal Road, Belgravia, Box 3198, Harare

Tel: +263 (0)8677002001

the region, causing a decline in agricultural activity. (NewsDay)

13. Ariston Holdings says its revenue for the six months ended March 31, 2019 went up by 50% compared to prior period despite the disturbances caused by Cyclone Idai. The group’s revenue for the half year was $7.96 million, up from $5.31 million realised during the comparative period. The group closed the half year with a profit after tax of $0.79 million compared to $0.028 million for the prior comparative period. (DailyNews)

14. Parliament has moved to force Auditor-General Mildred Chiri to bring before it the latest external forensic audit report on the National Social Security Authority. The move follows failure by Public Service, Labour and Social Welfare minister Sekai Nzenza to release the damning report which reportedly implicates senior government officials including serving and former Cabinet ministers in a US$82 million looting scandal. (DailyNews)

15. Transport group Unifreight Africa Limited allegedly prejudiced its shareholders on the Zimbabwe Stock Exchange (ZSE) an estimated US$18 million wired into an offshore account in the United Kingdom (UK) in 2014, resulting in an ongoing probe by the Reserve Bank of Zimbabwe (RBZ). Documents show that in 2015 one of the group’s local subsidiaries, Pioneer Transport was placed under judicial management arising from mounting debts, with the group recording a loss during the period. The alleged corporate malfeasance, which can potentially open a can of worms around Unifreight Africa’s financial statements from 2014-2017 prepared by auditing firm Ernst Young (EY), is now subject to an investigation by the central bank, according to confidential emails seen by the Independent. Under the Exchange Control Act (Chapter22:05), it is a criminal offence for an individual to bank money earned in Zimbabwe outside the country. (Independent)

-Page 6- Group Corporate Strategy ZB Financial Holdings Limited 1st Floor, 21 Natal 21 Natal Road, Belgravia, Box 3198, Harare

Tel: +263 (0)8677002001

16. Paynet, a subsidiary of Mauritian financial services provider Payserv Africa, has suspended all local financial institutions from its transacting platform after they refused to pay in foreign currency for its services. This has had the knock-on effect on RTGS payments. Paynet is the platform used in interbank RTGS transfers. The platform is also used by corporates to facilitate its payments. The standoff is the latest indication of a worsening economic crisis characterised by a debilitating liquidity crunch, foreign currency shortages, rising inflation, power outages and low productivity. The development means that there will be limited movement of funds during the standoff, which will affect the general public’s transactions. (Independent)

17. Leading global diamond producing firm, Alrosa PJSC, is yet to finalise its agreement with government to mine diamonds in the country, five months after government announced it was bringing the Russian firm on board, it has emerged. The company is still to be allocated diamond mining concessions. Government sources said the deal was being delayed because of bureaucratic red tape. The government and Alrosa announced in January that the Russian company would soon start operations in Zimbabwe to help in the development of its diamond- mining industry. So far, only the government-owned Zimbabwe Consolidated Diamond Company (ZCDC) and Anjin are operating in the Chiadzwa diamond fields. (Independent)

Regional News

1. South Africa’s rand slipped yesterday, as investors were unnerved by an investigation into a donation for President Cyril Ramaphosa’s 2017 campaign for leader of the governing African National Congress (ANC) party. Ramaphosa has said he will cooperate with the investigation into whether he misled parliament over the donation, made by the head of services company Bosasa, and analysts say is no immediate risk that he could be removed from office. But the anti-corruption watchdog’s investigation increases political uncertainty at a time when the

-Page 7- Group Corporate Strategy ZB Financial Holdings Limited 1st Floor, 21 Natal 21 Natal Road, Belgravia, Box 3198, Harare

Tel: +263 (0)8677002001

economy is performing poorly. At 0710 GMT, the rand traded at 14.90 versus the dollar, 0.2% weaker than its previous close. Government bonds also fell, as the yield on the benchmark 2026 bond rose 3.5 basis points to 8.40%. (Reuters)

2. Zambia will fine and break ties with mining firms that fail to operate according to the southern African country’s laws, President Edgar Lungu said yesterday, escalating a dispute with India- listed Vedanta. Vedanta is fighting Zambia’s decision last month to name a provisional liquidator to run its Konkola Copper Mines (KCM) business and is seeking international arbitration. Zambia, Africa’s second-largest copper producer, says KCM has breached the terms of its licence. The dispute between Vedanta and the Zambian government has intensified concerns among international miners about rising resource nationalism in Africa. (Reuters)

3. The International Monetary Fund said its board had completed the first review under Angola’s extended arrangement and approved a disbursement of $248.15 million, taking the total of such payments to about $1.24 billion. “The Angolan authorities have demonstrated strong commitment to policies under the Fund-supported program,” the IMF’s first deputy managing director and acting chair, David Lipton, said in a statement. “However, a weakened external environment, notably the heightened volatility in the international price of crude oil, is posing challenges to their reform efforts.” (Reuters)

4. South Africa’s business confidence in the second quarter remained unchanged from the previous quarter, a survey showed yesterday, as the country struggles to boost growth. The Rand Merchant Bank (RMB) business confidence index compiled by the Bureau for Economic Research was flat at 28 points in the second quarter, remaining far below the 50-mark separating the net positive and negative territories. President Cyril Ramaphosa’s efforts to revive Africa’s most advanced economy were dealt a blow last week when data showed gross

-Page 8- Group Corporate Strategy ZB Financial Holdings Limited 1st Floor, 21 Natal 21 Natal Road, Belgravia, Box 3198, Harare

Tel: +263 (0)8677002001

domestic product had contracted by a quarterly 3.2% in the first three months of 2019, the largest contraction in a decade. (Reuters)

5. Tanzania’s economy is forecast to grow at 7.1% in 2019, from 7.0% last year, Finance Minister Philip Mpango told lawmakers yesterday. Mpango also forecasted a budget deficit of 2.3% of GDP in 2019/20 (July-June). The full budget is due to be presented to parliament later yesterday. The economic forecast was slightly lower than what Mpango projected in March but higher than the International Monetary Fund’s projection of 4%. (Reuters)

6. Treasury says it wants to reduce fiscal pressure and macro-economic instability caused by natural disasters by ensuring that resources are channeled efficiently to beneficiaries and continued disaster risk reduction efforts. In its Disaster Risk Financing and Implementation Plan (2019-2024), Treasury expects disasters to increase due to rapid population growth, urbanisation and environmental degradation; hence, the need to enhance resilience. (Mwnation)

7. The Malawi kwacha has continued to weaken against major trading currencies such as the dollar and pound sterling largely due to businesses’ scramble to honour their payments ahead of the May 21 Tripartite Elections, the Reserve Bank of Malawi (RBM) ha said. The local unit, which has remained largely stable against the greenback has fallen to around K751 from K740, where it had been for a number of months, while the pound has also slid by 3.2% to K961.20 from K931.14 in five months. (Mwnation)

8. Treasury has received N$4.7 billion from the Southern African Customs Union for the first

-Page 9- Group Corporate Strategy ZB Financial Holdings Limited 1st Floor, 21 Natal 21 Natal Road, Belgravia, Box 3198, Harare

Tel: +263 (0)8677002001

quarter of this year. Established in 1910, Sacu is one of the oldest customs unions in the world, with Namibia, South Africa, Botswana, Lesotho and Eswatini as members. The union maintains the free interchange of goods between members, and provides a common external tariff and a common excise tariff to the customs area. All customs and excise fees collected are paid into South Africa's National Revenue Fund, and then shared among members according to a set formula. South Africa is the custodian of the revenue pool. (Namibian)

9. The Bankers Association of Namibia has warned the public of the emergence of a scam where fraudsters use new techniques. The Ban said scammers call clients, pretending to be bank staff, and targetting cellphone banking, iBank and eWallet users specifically. Sarel van Zyl, chairperson of the association, said yesterday that fraudsters are known to send a bogus SMS stating that the client received a complimentary E-ticket, with a number stated, and a message that the E-ticket can be used any day. However, banks do not issue E-tickets, and the purpose of the SMS is to coax the client to call the SMS sender's number. The client will then be taken through their usual bank process, where the client will 'unknowingly' EasyWallet or eWallet money to the fraudsters. (Namibian)

10. Lesotho’s tourist arrivals surged to 1.2 million in 2018, recording a 3.1% improvement from 2017, statistics from the Lesotho Tourism Development Corporation (LTDC) have shown. The revenue accrued from these international tourist arrivals was M488 million, excluding domestic tourist arrivals in the same year. This has resulted in the creation of 2717 jobs. According to the LTDC, most of the tourists who visited Lesotho came from South Africa, Zimbabwe, Germany, Netherlands and the United States of America. Although the number of international tourist arrivals slightly dipped to 800 000 in 2019, LTDC has noted the improvement made from 400 000 international arrivals observed in 2011. (LesothoTimes)

-Page 10- Group Corporate Strategy ZB Financial Holdings Limited 1st Floor, 21 Natal 21 Natal Road, Belgravia, Box 3198, Harare

Tel: +263 (0)8677002001

11. The African Development Bank remains strong with growing operating revenues and allocable income generated since 2010 reaching $2.5 billion, the Bank Group’s Treasurer, Hassatou Diop N’sele, stated yesterday. In 2018, the Bank earned $214 million in allocable income, 48% of which has been reinvested in the institution to reinforce reserves and its business growth capacity. The bullish numbers were revealed during the Bank’s financial presentation yesterday, a highlight of the 2019 Annual Meetings of the Bank currently underway in Malabo, Equatorial Guinea. (AllAfrica)

12. The African Export-Import Bank (Afreximbank) yesterday in Malabo received the award for the African Bank of the Year at the African Banker Awards 2019 ceremony held on the sidelines of the Annual Meetings of the African Development Bank. Amr Kamel, Afreximbank's Executive Vice President for Business Development and Corporate Banking received the award on behalf of the Bank. The award to Afreximbank was one of two big ones that went to development finance institutions as Admassu Tadesse, President of Trade Development Bank, was also named African Banker of the Year. (AllAfrica)

13. Public enterprises minister Leon Jooste says half of the millions of dollars that Air Namibia needs to get its aircraft back have been paid, and the Airbus planes should be returned as from tomorrow. He said this on the sidelines of a press conference held on Tuesday at the ministry's head office in Windhoek. The Namibian reported that three of the airline's four Airbus A319 planes for its regional routes were under maintenance, and could not be released until payment was made. (AllAfrica)

14. Although global foreign direct investment (FDI) flows suffered a setback of about 13% in 2018, with inflows sliding to $1.3 trillion from $1.5 trillion in the previous year, but sub-Saharan Africa (SSA), recorded growth of about 13%, pushing investment inflow to $32 billion in 2018.

-Page 11- Group Corporate Strategy ZB Financial Holdings Limited 1st Floor, 21 Natal 21 Natal Road, Belgravia, Box 3198, Harare

Tel: +263 (0)8677002001

However, the positive result in SSA only favoured other countries, especially South Africa, leaving out Nigeria, a United Nations Conference on Trade and Development (UNCTAD)'s 2019 World Investment Report, released yesterday, has shown. (AllAfrica)

International News

1. The US dollar trod water today and was set to show a weekly rise as investor focus turned to next week’s Federal Reserve meeting for hints on a possible rate cut in light of rising risks to trade and global growth. The dollar index against a basket of six rivals was largely unchanged at 97.029 and on track for a half-percent gain this week. The index had touched an 11-week low of 96.459 last Friday. The Federal Open Market Committee’s (FOMC) two-day policy meeting is set to begin on Tuesday. With trade tensions rising, U.S. growth slowing and hiring in May declining, markets have priced in at least two rate cuts by the end of 2019. (Reuters)

2. Jeffrey Gundlach, Chief Executive Officer of DoubleLine Capital, said yesterday the odds of the United States sliding into a recession in the next six months have risen to 40-45% and the odds were 65% within the next year. Gundlach, who oversees more than $130 billion in assets under management, said the yield curve and the New York Fed recession probability showed a rising chance of recession. “Several indicators suggest a recession could take place in one year,” Gundlach said on an investor website, adding consumer indicators point to “the front edge of a recession.” (Reuters)

3. Facebook Inc has enlisted more than a dozen companies including Visa Inc, Mastercard Inc, PayPal Holdings Inc and Uber Technologies Inc to back its new cryptocurrency, The Wall Street Journal reported yesterday. Each company will invest around US$10 million in a consortium that will govern the cryptocurrency, the WSJ reported, citing people familiar with the matter. The

-Page 12- Group Corporate Strategy ZB Financial Holdings Limited 1st Floor, 21 Natal 21 Natal Road, Belgravia, Box 3198, Harare

Tel: +263 (0)8677002001

money will fund the creation of the coin, which will be pegged to a basket of government- issued currencies, the report said. (BusinessTimes)

4. The global use of the euro currency surged from record lows last year, mostly on a flight from the US dollar due to the volatility of American politics and concerns about rising US interest rates, the European Central Bank (ECB) said yesterday. Demand for the euro, the world's second most widely used currency after the dollar, fell to historic lows over the past decade. Its rebound suggests both concerns about US politics and growing confidence about the future of the eurozone, which survived its biggest test yet during its debt crisi (BusinessTimes)

5. China may be an odd choice for investors seeking shelter from a Sino-US trade war. Yet, money managers in Asia are pouring funds into Chinese stocks as the long-term promise of a growing middle class trumps more immediate fears about tariffs. It is also a vote of confidence in Beijing's aggressive policy response to a festering Sino-US trade standoff which has hurt its economy, unsettled world financial markets and triggered fears of a global recession. The anxiety has forced investors into defensive holdings such as the safe haven yen, gold and US Treasuries. (BusinessTimes)

6. Indonesia's foreign exchange reserves dropped by around US$4 billion to US$120.3 billion at the end of May due to the government's foreign debt payments as well as dividend payments by corporations, the central bank said yesterday. It was down from US$124.3 billion at the end of April. The end-May reserves level is equal to 6.9 months of imports or 6.7 months of imports and foreign debt payments which is above an international standard of three months, Bank Indonesia (BI) said in a statement. BI expects the forex reserves to remain adequate, supported by a stable economy and good economic prospects. (BusinessTimes)

-Page 13- Group Corporate Strategy ZB Financial Holdings Limited 1st Floor, 21 Natal 21 Natal Road, Belgravia, Box 3198, Harare

Tel: +263 (0)8677002001

7. EU finance ministers agreed on the broad outlines of a eurozone budget early Friday, France's finance minister said, a key reform pushed by Paris that was scaled back amid deep resistance by the Netherlands. "We did tonight what we had set out to do: we've created a genuine eurozone budget," Bruno Le Maire said after more than 12 hours of talks. "For the first time, we have created an operational budget that will help eurozone countries to converge and become more competitive. It's a breakthrough," he told AFP. "For the first time, we will start thinking about the future as a coherent bloc and coordinating our economic policies," he added. (BusinessTimes)

8. Singapore’s Government Technology Agency (GovTech) and the UK’s Government Digital Service (GDS) have signed a memorandum of understanding (MOU) to strengthen their collaboration in the design and delivery of digital government services, both agencies announced in a press statement today. GovTech is the lead agency driving Singapore's Smart Nation initiative and the public sector's digital transformation. Under the MOU, GovTech and GDS will share knowledge and best practices in building the digital skills of government officials, and adopting open standards for government information, data and software, among other things. (BusinessTimes)

9. The National Australia Bank Ltd. (ASX: NAB) is the latest to join the “three rate cut” club after its economists issued a statement predicting an extra rate cut in November this year, which will take the official cash rate to a new record low of 0.75%. (BusinessTimes)

10. The State Bank of Vietnam (SBV) will continue to follow a pro-active, flexible and cautious monetary policy as well as working in close conjunction with fiscal and other policies to control

-Page 14- Group Corporate Strategy ZB Financial Holdings Limited 1st Floor, 21 Natal 21 Natal Road, Belgravia, Box 3198, Harare

Tel: +263 (0)8677002001

inflation, sustain the macro-economy and support economic growth in the second half of this year. SBV Deputy Governor Nguyen Thi Hong made the statement at a conference in Hanoi on June 13 to review the SBV’s monetary policy in the first half of 2019 and announce its key orientations for the second half of the year. (NewsNow)

11. Threatening to leave the European Union without a deal isn’t likely to win Britain concessions from the bloc, the country’s biggest business group said in a warning to candidates jostling to succeed Prime Minister Theresa May. Confederation of British Industries Director General Carorlyn Fairbairn Said.

-Page 15-