Trade report 23/09/2013
ZAR outlook
USD/ZAR expected range: 9.7900 – 9.9400
Encouraging US jobless claims and US existing home sales data released on Friday helped the USD to rebound 3.1% after initial losses post the FOMC announcement last Wednesday evening. After incurring some heavy losses on Friday mainly due to this positive US data the ZAR has firmed against the USD in morning trade today and is trading around R9.84/$.
Local news
The Rand is currently one of the worst performing EM worldwide partly due to struggling negative sentiment created by the on-going local strike action. THE SARB also announced last week that it is maintaining the current low repo rate at 5% and while this is good news to consumers these low interest rates do not provide any buffer to the strength of the Rand.
International news
A recent strong factory survey from China has lifted commodity currencies that rely on exports to that country. This has helped the ZAR strengthen slightly this morning, although the market will now be looking to speculate on when the FOMC will start QE tapering. This will have investors paying keen interest to the FED member’s speeches that are scheduled for this week.
TODAYS KEY DATA POINTS (GMT):
• 12:30 US Chicago Fed activity index
• 12:58 US Markit PMI manufacturing
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