Rand ticks lower in choppy trading session
Compiled by Dhivana Rajgopaul
JOHANNESBURG - The South African rand oscillated as traders digested the Fed minutes release according to NKC Resesarch.
On US soil, initial jobless claims for regular state benefits rose by 135,000 to 1.106 million in the week ended August 15, well above consensus expectations for an increase to 920,000. As we mentioned previously, we believe the dollar is on the cusp of a multi-year downward swing, which is set to benefit risk-sensitive emerging market currencies. Unlike in 2017, the Fed is accommodative and in an open-ended manner, which we believe reduces risks of emerging market asset tantrums. We are aware of short-term risks stemming from both events in the US (the politics of fiscal stimulus) and within emerging markets themselves (another liquidity crisis in Turkey, which may spill over to the broader asset class, as well as simmering US-China trade tensions). At the close of local trade, the rand quoted 0.19 percent weaker at R17.33/$, after trading in range of R17.19/$ - R17.35/$. Expected range today R17.00/$ - R17.40/$.
South African bourse
The JSE All Share (-1.42 percent) ended in the red yesterday dragged by losses across the board. In local news, Gold Fields reported a four-fold rise in half-year earnings yesterday, thanks to the recent jump in precious metals prices. In the overall emerging market sphere, the MSCI Emerging Market Index (-1.72 percent) traded lower.
Brent crude oil
The Brent oil price fell yesterday following dreary US jobs data, compounded by worries of over supply by Opec+. At the close of local trade, benchmark Brent crude futures quoted 0.49 percent lower at $44.83pb. Crude prices traded steady during Asian trade this morning.
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