CAPE TOWN - The rand was somewhat surefooted yesterday after US President Donald Trump’s potshot at Federal Reserve chairperson Jerome Powell over interest rates weighed on the dollar allowing the domestic currency to trade in a range of between R14.26 and R14.46.
Meanwhile the inflation figures had little impact on the rand with the consumer price index (CPI) 5.1 percent year on year in July 2018 from 4.6 percent in June, the 16th consecutive month below the SA Reserve Bank’s upper-target level of 6 percent but somewhat higher than market expectations of 5 percent.
Corporate treasury manager at Peregrine Treasury Solutions, Bianca Botes, said earlier that higher-than-expected CPI figures would surely put pressure on the rand and interest rate hikes will become a reality.
“While inflation is expected to have bottomed and an approach towards the upper band of the inflation target range is expected, the weak rand is likely to accelerate this move which will see already strained consumers come under further pressure,” said Botes.
At 5pm the domestic currency was bid 6c firmer than Tuesday’s same time bid at R14.30 a dollar. Against the pound sterling the rand was 1c stronger at R18.45 and to the euro, the currency eased 4c to R16.58.