Trade report 22/08/2013
ZAR outlook
USD/ZAR expected range: 10.30-10.40
The Rand has blown out overnight, on not only international data but also from the continued industrial strikes which seem imminent. The Rand is running at a current account deficit and with both international news and local strife means the Rand will be vulnerable to further weakness.
Local news
The main local news is with regards to NUM (National Union of Mineworkers) stating it will be balloting its members to see if they will be going on strike. If the strikes go ahead it will have severe impact on the already struggling gold miners but will cause further negative sentiment amongst the international investors over SA ability to manage its labour force as currently 30 000 automotive workers are currently on strike.
International news
From the minutes of the FOMC, although not clearly stated it seems that FED tapering will likely occur in the next couple of months. This will leave EM currencies like the Rand at risk as investors sell off Rand investments and invest in safe haven currencies such as the USD.
TODAYS KEY DATA POINTS:
• 7am: SA earnings (TRU, GFI)
• 9am: France Aug PMI (50.2)
• 9.30am: Germany Aug PMI (51.1)
• 2.30pm: US initial jobless (330k), cont claims (2.96m)
• 3pm: US June House Price Index
• 4pm: US July Lead Indicator (+0.5% m/m)
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