Tuesday, 1 October 2013

Rand benefits off struggling dollar

Trade report 01/10/2013

ZAR outlook

USD/ZAR expected range: 9.9400 – 10.1000


The ZAR has managed to firm up against that USD after a loss in US investor confidence as the US government failed to reach a decision in budget debates which means a partial government shutdown from today.  The Rand was trading at R9.9650/$ at 08:59 this morning, 068% up from its close in New York yesterday.

Local news

South Africa’s trade deficit for the month of August has unexpectedly widened to 19.05 billion rand, a 7-month high which is a key concern for the current account over the rest of the year.  Despite this, the ZAR has managed to hold firm against the USD, although traders are weary as to how this will be sustainable going forward.

International news

Investor confidence in the USD has slipped as lawmakers failed to reach an agreement on budget legislation by midnight on Monday night.  This stalemate in the US seems to have overshadowed recently released weak Chinese figures that have hit commodities, as this data would normally put pressure on the ZAR.

TODAYS KEY DATA POINTS (GMT):

•    09:00    SA    Kagiso manufacturing PMI
•    09:00    SA    Naamsa vehicle sales y/y
•    08:30    GB    PMI manufacturing
•    12:58    US    Markit PMI manufacturing (final)
•    14:00    US    ISM manufacturing PMI

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