File Photo: IOL
File Photo: IOL

Rand steadies against a strong dollar

By Reuters Time of article published Jul 9, 2019

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The rand steadied against a firmer dollar in afternoon trade yesterday, after last week’s strong US jobs data lowered expectations of a sharp Federal Reserve interest rate cut.

At 5pm, the rand bid at R14.1478 to the dollar, 3cents stronger than at the same time on Friday.

“With the economic calendar in South Africa relatively light this week, the rand is positioned to be influenced by outside forces in the form of trade developments, Fed rate cut speculation and the dollar’s valuation,” Lukman Otunuga, research analyst at FXTM, said in a note.

“Should speculation of a US interest rate cut diminish further on improving fundamentals in the United States, Dollar bulls could make an uninvited return - ultimately punishing the Rand and other emerging market currencies.”

South African-focused investors are this week waiting for mining and manufacturing data for the month of May for clues on the health of the economy after GDP contracted in the first quarter.

In fixed income, the yield on the benchmark government bond due in 2026 dipped by 5 basis points to 8.12 percent.

On the stock market, the Top40 index closed 0.21 percent higher at 51649.36 points, while the broader all share was up 0.25 percent at 57731.4 points

Impala Platinum rose 3.38 percent to R74.85 after the mining firm said it expected to swing back to annual profit.

I Reuters

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