The rand was softer in early trade on Monday as traders looked to the gathering of eurozone finance ministers later in the day to decide whether Greece receives the next instalment of bailout money.
At 8.32am‚ the rand was bid at R8.9009 to the US dollar from Friday’s close of R8.8616. The local currency was bid at R11.5189 to the euro from its previous close of R11.2631 and at R14.2468 against sterling from R14.2125 before.
The euro was bid at $1.2948‚from Friday’s close of $1.2973.
Analysts at Absa Capital said in a note that the rand had started to take more direction from abroad in recent weeks‚ so rand bulls would be hoping European finance ministers could find common ground on the next bail-out tranche for Greece.
“However‚ even if the rand does indeed benefit from the improved risk appetite associated with such financial assistance‚ we believe that rand bulls should remain cautious‚ given that the US fiscal cliff still looms large‚ not to mention that this week’s local GDP (gross domestic product) data will highlight the extent of the country’s recent strike activity‚ which will place the rand in a vulnerable light from a relative growth differential perspective‚” Absa Capital said.
“Hence‚ we still like selling into rand strength and expect an 8.80-9.00 range to hold over the coming days.” - I-Net Bridge