Dynamic Outcomes’ James Paynter said monetary policy committee was between a rock and a hard place, with Treasury Bill rates suggesting a small rate increase with an economy that hardly needs more stress.
“We are not playing the normal economist ‘outcome drives direction’ game Instead we will be looking at the market patterns themselves to get direction and that suggests some more downside although we could see some retracement first.”
At 5pm the rand was bid 4cents stronger than Friday’s same time bid at R13.23 to the greenback. Against the pound, the local unit was largely unchanged at R17.52 and to the euro, the currency eased 1c to R15.50.
Corporate treasury manager at Peregrine Treasury Solutions, Bianca Botes, said the Reserve Bank was expected to keep interest rates on hold, given the current consumer price index (CPI) level and potential upward pressure brought on by rising fuel prices, tariff hikes and a weaker currency.
“The CPI is due for release on Wednesday which is likely to set the tone for this week’s MPC meeting. I’m not convinced that the rand has enough momentum to remain below R13.30, but for now it is enjoying the reprieve as the dollar remains subdued,” she said.
JSE stocks took a beating yesterday with the blue chip Top40 index sinking 1.8percent to 49338.95 points, while the broader all share index declined 1.64percent to 55442.04 points.
Leading losses among major moves were Impala Platinum, which tanked 8.76percent to R18.01, followed by Steinhoff, which gave up 5.45percent to R2.95.
Bidvest Group declined 4.25percent to R182.75, while Kumba Iron Ore fell 3.71percent to R293 and Truworths gave up 3.59percent to end the day R73.11.
Among top gainers were Italtile, up 4.5percent to R13.01, followed by Anglo American Platinum gained 3.5percent to R368.09.
Sibanye added 2.17percent to R7.53, while Astral Foods inched up 1.34percent to R315.24 and the JSE, which scored 1.23percent growth to end the day at R161.75.
- BUSINESS REPORT