Tuesday, 17 September 2013

Rand steady ahead of FOMC meeting

Trade report 17/09/2013

ZAR outlook

USD/ZAR expected range: 9.7500 – 9.9200


The Rand gained nearly 1.2% against the USD in trading on Monday, and this morning slipped only 0.3% to 9.8310 to the USD.  European data due to be released today shouldn’t hold any significant value, so traders are confident of a narrow range of trading for the day, ahead of the much anticipated FOMC meeting scheduled for tomorrow.

Local news

Investors appear to have been de-sensitised to the local gloom of on-going strike action as international news takes priority.  The uncertainty over the FOMC meeting this week has allowed the Rand to see surprising gains.  SA retail sales and CPI data is due out this week, but will unlikely have much impact on the ZAR as investors focus on whether or not QE tapering will be implemented.

International news

Emerging markets worldwide have benefited from the FEDs monthly bond purchasing programme which the central bank may start scaling back as the US shows signs of economic recovery.  Despite this, EM currencies have enjoyed a period of significant gains, although tomorrow may see the start of renewed volatility in the markets as investors react to the outcome of the FOMC meeting.


TODAYS KEY DATA POINTS (GMT):

• 09:30 SA Bond auction
• 09:30 SA Non-farm payrolls y/y
• 08:30 GB CPI y/y
• 12:30 US CPI y/y
• 14:00 US NAHB Housing market index


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