Wednesday, 4 September 2013

Rand firms as NUM lowers wage demands

Trade report 04/09/2013

ZAR outlook


USD/ZAR expected range: 10.2000 – 10.4100

The markets picked up yesterday after the quieter start to the week and the ZAR lost ground in the closing session yesterday afternoon closing at 10.3250 to the dollar, but this morning managed to firm up slightly as the National Union of Minewokers (NUM) offered to lower its wage increase demands earlier today.  But the ZAR is likely to remain on the back foot as it struggles against negative investor sentiment due to other on-going strikes and mounting talk about military action in Syria.

Local news

The gold miners strike which started yesterday is set to cost the local economy $35 each day it continues.  Since NUM have offered to lower the wage increase demand it is hoped this will shorten the duration of the strike, which will help the struggling ZAR, as strikes in the auto sector and clothing and manufacturing sector continue.

International news

Recent US data released this week shows an improvement in the US economy.  This raises expectations that the FED will taper QE, and with the next FOMC meeting set for the middle of the month, this places pressure on the already vulnerable Rand and other emerging markets.

TODAYS KEY DATA POINTS:

• 08:30 GB PMI services
• 11:00 US MBA mortgage applications
• 12:30 US Trade Balance (USD)
• 13:45 US ISM New York


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