Rand benefits from receding dollar
JOHANNESBURG - The South African currency benefited from a retreating greenback as a lack of local releases turned the attention to the two-day FOMC meeting which will conclude on Wednesday according to NKC Research.
The FOMC is in the midst of its blackout period and is expected to reaffirm its very dovish forward guidance, and it might be ready to link it explicitly to an inflation or unemployment target. We believe the Fed is leaning towards stating it will not lift interest rates off the effective lower bound (ELB) until inflation is sustainably at or above the 2 percent y-o-y target, which could be until 2024. At the close of local trade, the rand quoted 1.21 percent stronger at R16.40/$, after trading in range of R16.40/$ - R16.71/$. The rand stepped onto the back foot this morning. Expected range today R16.30/$ - R16.60/$.
South African bourse
The JSE All Share (+1.22 percent) shined on the back of ebullient gold mining (+8.73 percent) stocks yesterday. However, Anglo American Platinum (+1.46 percent) said that output disruptions due to the coronavirus weighing on its financial performance in 2020. Headline earnings per share (Heps) for the half year ended June 30 dropped by 7 percent to R26.27 per share, compared with R28.15 the previous year.
Brent crude oil
The Brent oil price fell suddenly yesterday afternoon, dragged by rising Covid-19 cases while Sino-US tensions weighed on the prospects of a recovery in crude demand. At the close of local trade, benchmark Brent crude futures quoted 1.57 percent lower at $42.54pb. Crude prices traded steady during Asian trade this morning.
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