Thursday, 26 September 2013

Rand holds steady ahead of inflation data

Trade report 26/09/2013

ZAR outlook

USD/ZAR expected range: 9.9000 – 10.0500

The ZAR is steady against the USD and was little changed this morning from its overnight close in New York of R9.9775/$.  Concern was raised over the US budget and wording on the 2010 health-care law which could represent a risk to the US growth outlook.  This put some pressure on the USD yesterday and helped the Rand stay firm.


Local news

Local PPI figures for August are due to be released today and may put pressure on the Rand if they reveal that inflation is building in Africa’s largest economy.  Added to this there is a renewed threat of another mining strike which would hurt investor sentiment, as the Association of Mineworkers and Construction Union has announced it will strike on Friday to protest job cuts.

International news

The ZAR could also be put on the backfoot should US jobless claims data released later today come in stronger than expected.  This would add to increasing speculation that the FED will start its QE tapering at its next meeting which would put pressure on not only the Rand, but all emerging market currencies.

TODAYS KEY DATA POINTS (GMT):

• 09:30 SA PPI y/y
• 09:30 SA Switch auction (R201s for R186s)
• 08:30 GB Current account balance (GBP)
• 08:30 GB GDP y/y (final)
• 12:30 US Initial jobless claims
• 12:30 US GDP q/q annualised (third reading)
• 12:30 US Personal consumption (third reading)
• 14:00 US Pending home sales y/y


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