The rand was range bound in afternoon trade‚ on depressed global sentiment and as markets await the outcome of monetary policy committee (MPC) meeting on Thursday.
Market sentiment took a downturn after Federal Reserve chairman Ben Bernanke indicated that the world’s largest economy was in a fair amount of distress.
Local consumer price index‚ which came in at 5.5% year on year in June from 5.7% in May‚ had little effect on the currency.
At 15:42 the rand was bid at R8.1890 to the dollar from its previous close of R8.1646 . It was bid at R10.0330 to the euro from its previous close of R10.0321 and at R12.7941 against sterling from R12.7751 before.
The euro was bid at US$1.2255 from its previous close of $1.2286.
Nedbank Capital in their monthly currency insight report said the rand would remain volatile and on a weaker trajectory for as long as the global environment remained difficult.
“Unfortunately‚ the current stop-start conditions in international markets and economies are likely to persist for some time.
In these circumstances local conditions are likely to play a relatively minor role‚” read the report.
Mohammed Yaseen Nalla of Nedbank Capital said: “We have been pretty much range bound; many people are waiting for a cue tomorrow from the MPC before taking direction. The UK data came out better than expected‚ which gave the markets a little bit of appetite but it was nothing significant.”
Two members of the Bank of England's policy panel voted against additional monetary stimulus at July's meeting‚ arguing that the raft of measures put in place by the UK's lender of last resort were sufficient to support the economy‚ Dow Jones Newswires said.
Governor Mervyn King led the remaining seven members in expanding the BOE's asset-purchase programme by 50 billion pounds ($77.86 billion) to GBP375 billion ($583.98 billion)‚ citing a “compelling and stronger” case than the prior meeting to inject more cash into the UK economy and spur lending as inflation decelerates. - I-Net Bridge