Rand at 8.32 against the US dollar

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IOL world currency1 Graphic: Renjith Krishnan.

Depressed global sentiment continued to affect markets in midday trade on Thursday‚ keeping the rand in negative territory.

Analysts said the US Federal Reserve minutes suggested a marked economic slowdown in the US‚ which would require another round of easing measures.

These minutes made the euro slide deeper into negative territory as there was no firm signal on the timing of these easing measures‚ which kept the dollar on the front-foot versus the euro.

At 11:50 the rand was bid at R8.3227 to the dollar from its previous close of R8.2371. It was bid at R10.1696 to the euro from its previous close of R10.0796 and at R12.8736 against sterling from R12.7697 before.

The euro was bid at US$1.2219 from its previous close of $1.2244.

“The euro is under-pressure and so is the rand. The FMOC minutes have kept the rand on the back foot together with the euro. We expect it to reach 8.35‚” a local trader said.

Industrial production in the 17 countries that use the euro rose unexpectedly in May as demand for a range of goods rose‚ while German output was the strongest since July last year‚ data from the European Union's statistical agency Eurostat showed on Thursday‚ according to Dow Jones Newswires.

However‚ the year-on-year drop was the biggest since December 2009 highlighting the ongoing weakness of the sector and the economy as a whole amid the deepening debt crisis.

Industrial production rose 0.6% on the month in May and fell 2.8% on the year. - I-Net Bridge

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