Rand claws back losses
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THE rand shrugged off a sombre unemployment data release to firm on the back of improving global risk sentiment, according to NKC Research.
A more cheery mood in global commodity markets carried through to commodity-linked currencies, with risk sentiment improving despite expectations for more clarity on the US Federal Reserve’s tapering schedule at the upcoming Jackson Hole Symposium.
External tailwinds dwarfed the impact of a weak unemployment reading, with the headline unemployment rate hitting a record high of 34.4% in the second quarter as businesses’ pandemic-induced cost-shedding extended to staff reductions.
Meanwhile, the focus has already shifted to Fed chairperson Jerome Powell’s Friday morning speech at the Kansas City Fed’s Jackson Hole symposium amid the possibility that he will offer more details about where the Fed stands on asset purchase tapering.
NKC Research expects that the Federal Open Market Committee will announce plans for the tapering of quantitative easing as soon as the September 21/22 policy meeting.
At the close of local trade, the rand was 0.6 percent stronger at R14.98 to the dollar, after trading in range of R14.98 to R15.18. The rand traded weaker overnight. The expected range of the rand against the dollar today is R14.90 to R15.20.
Brent crude oil
The Brent oil price traded higher yesterday, as sentiment on demand became rosier following news of US regulators approving the Pfizer vaccine. Prices were also supported by lost production in Mexico, as a fire on an offshore platform took out production of about 400 000 barrels per day. At the close of local trade, benchmark Brent crude futures were 2.3 percent higher at $70.70 per barrel. Crude prices traded lower during Asian trade this morning.