Trade report 16/09/2013
ZAR outlook
USD/ZAR expected range: 9.7000 – 9.9800
US data released on Friday came in softer than expected. This has helped the ZAR reach a 5 week high against the USD this morning, reaching 9.8165 against the dollar by 08.51GMT and looking to improve throughout the morning. Speculation that the US Federal Reserve could maintain an accommodative stance towards QE tapering has been a boost to the majority of emerging markets.
Local news
Strike action continues to hamper SA business, including the auto-motive components sector strike which has just about brought the sector to a standstill. But thankfully these issues seem to be overshadowed by international sentiment at the moment. General feeling is also that the SARB will keep interest rates unchanged. This will be good news to local consumers but may leave the ZAR exposed as real interest rates remain negative.
International news
The ZAR is currently enjoying 5 week highs as general market feeling is that the FED will take a gentle stance towards QE tapering after disappointing payroll and retail sales data was released on Friday. But the ZAR’s gains could be short-lived as some traders still expect the FED to reduce its bond purchases by $15bn. With the FOMC meeting on Wednesday it should be an interesting week for the ZAR and all EM currencies.
TODAYS KEY DATA POINTS (GMT):
• 12:30 US Empire manufacturing
• 13:15 US Industrial production
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