Rand loses ground after weak Q2 GDP release
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JOHANNESBURG - The South African currency retreated in the face of an abysmal – and weaker-than-expected – Q2 GDP release according to NKC Research.
While expectations were fixed for a dire reading, the 51 percent (saar) plunge outpaced expectations for a 46 percent decline in Q2. The rand furthermore faced headwinds from a stronger US dollar as second wave concerns and weakening global trade sentiment clipped risk appetite. An upsurge in US-Sino trade tensions also soured sentiment towards risk assets.
At the close of local trade, the rand quoted 1.05 percent weaker at R16.90/$, after trading in range of R16.70/$ - R17.00/$. The rand remained under pressure in Asian trading. Expected range today R16.75/$ - R17.00/$.
South African bourse
The JSE All Share (+0.07% percent) ended higher yesterday led by gains in lathe financial (+2.77 percent) and industrial (+0.21 percent) shares. In local news, Shoprite (+10.81 percent) plans to exit Kenya after two years as the local retailer continues to review its long term-options in Africa. In the overall emerging market sphere, the MSCI Emerging Market Index (-0.64 percent) traded lower.
Brent crude oil
The Brent oil price fell to its lowest level since June amid growing concerns over future fuel demand. At the close of local trade, benchmark Brent crude futures quoted 6.20 percent lower at $39.36pb. Crude prices traded flat during Asian trade this morning.
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