CAPE TOWN - The rand opened about 0.5 percent weaker on Tuesday, trading near the R13.40 mark before strengthening to R13.28 during intraday trade.
However, it is not all doom and gloom as analysts reckon the domestic currency’s weaker level could impact positively on manufactured exports, despite the dim outlook for the manufacturing sector, which rose only 0.7 percent year on year in June.
Corporate treasury manager at Peregrine Treasury Solutions, Bianca Botes, said overall the emerging market picture was gloomy, while South Africa’s outlook is further smeared with local elements such as failing state-owned entities, renewed policy uncertainty as well as sluggish economic growth.
“Turkey’s attempt to assist its currency failed as the diplomatic spat between the emerging market and the US overshadows any attempt by the local government to provide some financial stability, while China and the US have a harsh exchange of words as both countries forge ahead in the trade war,” said Botes.
At 5pm the domestic currency was bid 9c firmer than Tuesday’s same time bid at R13.31 a dollar. Against the pound, the rand was 10c stronger at R17.25 and to the euro, the currency strengthened 6c to R15.43.