JOHANNESBURG - The rand traded on a firmer footing during Wednesday’s European session as July’s inflation release surprised to the downside, stoking optimism of policy easing in Q4, attracting interest from investors eager to lock in attractive rates on South African bonds according to NKC Research.
However, we retain our view that the repo rate will be kept at 6.5 percent throughout H2, amid fiscal slippage and looming risks of a credit rating downgrade, in addition to pressure on emerging-market growth amid US-China trade uncertainty. At the close of local trade, the rand quoted 0.53 percent stronger at R15.23/$, after trading in range of R15.16/$ - R15.37/$. The rand traded weaker overnight. Expected range today R15.15/$ - R15.40/$.
South African bourse
The JSE All Share (+0.66 percent) ended higher yesterday, instep with global stock markets, as investors awaited the release of the latest FOMC minutes. In the overall emerging market sphere, the MSCI Emerging Market Index (+0.31 percent) traded higher.
Brent crude oil
Brent edged higher as oil stockpiles fell more than expected. The latest Energy Information Administration data showed that US crude inventories fell by 2.7 million barrels in the week ended August 16. However, lingering concerns over Sino-US trade kept a lid on gains. At the close of local trade, benchmark Brent crude futures quoted 0.46 percent higher at $60.71pb. Crude prices traded steady during Asian trade this morning.
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