File image: IOL
File image: IOL

WATCH: Rand trades in a narrow band overnight

By Compiled by Dhivana Rajgopaul Time of article published Mar 5, 2020

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JOHANNESBURG - The rand clung on to Tuesday’s gains as markets digested an emergency Fed rate cut in response to Covid-19 on Wednesday according to NKC Research. 

In a surprise move, and following an underwhelming G-7 joint statement, the US Federal Reserve delivered a 50- bps rate cut – bringing the federal funds rate range to 1 percent -1.25 percent – to mark the first move of this nature since the 2008 financial crisis. This comes as policymakers are increasingly concerned about the economic damage from the coronavirus outbreak and are looking to preserve the longest economic expansion on record. The cut, however, proved insufficient to lift market optimism. At the close of local trade, the rand quoted 0.15 percent stronger at R15.34/$, after trading in range of R15.23/$ - R15.43/$. The rand traded in a narrow band overnight. Expected range today R15.20/$ - R15.45/$.

South African bourse

The JSE All Share (-0.06 percent) traded slightly on the red yesterday as stock markets elsewhere turned positive. Familiar names in the gold industry such as Harmony Gold (+7.57 percent), Gold Fields (+5.12 percent), and AngloGold Ashanti (+4.38 percent) benefited from the yellow metal’s recent rally. In the overall emerging market sphere, the MSCI Emerging Market Index (+0.97 percent) traded higher.

Brent crude oil

The Brent oil price struggled for traction yesterday, as a muted market mood weighed on prices after an emergency interest rate cut by the Fed shocked markets. At the close of local trade, benchmark Brent crude futures quoted 0.38 percent lower at $52.43pb. Crude prices were on the back foot during Asian trade this morning. 

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