Trade report 29/11/2013
ZAR outlook
USD/ZAR expected range: 10.1500 – 10.2700
After a volatile week for the Rand the currency is holding steady against the USD this morning. The markets have been quiet with low trading volumes as the USA celebrated Thanksgiving yesterday, allowing the Rand a slight reprieve. The ZAR was little changed from its overnight close this morning and at 06:43GMT was at R10.1855/$.
Local news
South Africa’s twin deficits have left the ZAR exposed to volatile trading and it remains one of the less attractive EM currencies. With this in mind the ZAR will take its direction today from the local trade data that is due for release today. Poor data figures will increase the pressure on the ZAR, but stronger than expected data may allow the ZAR to hold steady.
International news
The US markets are closed today and as a result the markets have been very quiet with low trading volumes. Despite this, USD weakened yesterday against the EUR mostly due to positive inflation data out of Germany, and the EZ business and consumer confidence data released which matched economists forecasts.
TODAYS KEY DATA POINTS (GMT):
• 06:00 SA M3 money supply y/y
• 06:00 SA Private Sector credit y/y
• 12:00 SA Government budget balance (ZAR)
• 12:00 SA Trade balance (ZAR)
• US Day after Thanksgiving – early market closures
• 07:00 GB Nationwide house prices nsa y/y
• 07:00 DE Retail sales y/y
• 09:30 GB Net consumer credit (GBP)
• 10:00 EZ Unemployment rate
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Friday 29 November 2013
Thursday 28 November 2013
Quieter day in the markets after Rand takes a knock
Trade report 28/11/2013
ZAR outlook
USD/ZAR expected range: 10.1500 – 10.2900
The persistent foreign outflows from SA and poor economic growth data released this week took its toll on the Rand late yesterday and during this morning’s session as the ZAR dropped to R10.2325 by 08:59GMT this morning. The Thanksgiving holiday in the US today should give the Rand a breather and allow it to steady, although the large budget and current account deficits means the ZAR remains vulnerable.
Local news
Comments made by SARB Deputy Gov Kganyago hinted that while the SARB suggested a more hawkish leaning towards interest rates at its latest meeting, that its core stance remains a dovish one. He mentioned that consumers are battling debt and therefore vulnerable to higher rates and that the exchange rate “should not dominate our thinking.”
International news
Today looks to be a quiet day as the US celebrates Thanksgiving which means trading volumes should be low. There are a few data releases scheduled in the Eurozone countries which might be of interest in the ECB policy thinking, but tomorrows EZ CPI figure will most likely be more relevant.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA PPI y/y
• US Market holiday (Thanksgiving Day)
• 08:55 DE Unemployment rate sa
• 09:00 EZ M3 money supply sa y/y
• 10:00 EZ Consumer confidence (final)
• 13:00 DE CPI y/y (preliminary)
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ZAR outlook
USD/ZAR expected range: 10.1500 – 10.2900
The persistent foreign outflows from SA and poor economic growth data released this week took its toll on the Rand late yesterday and during this morning’s session as the ZAR dropped to R10.2325 by 08:59GMT this morning. The Thanksgiving holiday in the US today should give the Rand a breather and allow it to steady, although the large budget and current account deficits means the ZAR remains vulnerable.
Local news
Comments made by SARB Deputy Gov Kganyago hinted that while the SARB suggested a more hawkish leaning towards interest rates at its latest meeting, that its core stance remains a dovish one. He mentioned that consumers are battling debt and therefore vulnerable to higher rates and that the exchange rate “should not dominate our thinking.”
International news
Today looks to be a quiet day as the US celebrates Thanksgiving which means trading volumes should be low. There are a few data releases scheduled in the Eurozone countries which might be of interest in the ECB policy thinking, but tomorrows EZ CPI figure will most likely be more relevant.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA PPI y/y
• US Market holiday (Thanksgiving Day)
• 08:55 DE Unemployment rate sa
• 09:00 EZ M3 money supply sa y/y
• 10:00 EZ Consumer confidence (final)
• 13:00 DE CPI y/y (preliminary)
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Wednesday 27 November 2013
ZAR on the backfoot after GDP data disappoints
Trade report 27/11/2013
ZAR outlook
USD/ZAR expected range: 10.0900 – 10.2300
The Rand has retreated against the USD this morning and at 08:45 GMT was more than 0.2% off it’s Tuesday close at R10.1440/$. The markets seem to be moving away from risky assets as investors are selling off local bonds, which is not good for the Rand. Combined with the poor GDP data released yesterday the ZAR has been struggling in the last two sessions.
Local news
SA’s Q3 GDP, released yesterday, increased by only 0.7% q/q which is below the general estimate of 1.0% and well below the Q2 figure of 2%, meaning that the 2013 growth target of 2% looks unachievable as well. Not only does this add pressure to the Rand but it also highlights the effects of the recent strikes that went on for weeks and warns of another low Q4 figure as, although mostly resolved, there are still some strikes on-going.
International news
The markets are relatively quiet, although trading volumes are still medium-high, as we approach the end of the year. With little key data due for release, the primary driver is speculation over the timing of the Fed taper, which keeps the pressure on the emerging market currencies.
TODAYS KEY DATA POINTS (GMT):
• 09:00 DE GfK consumer confidence
• 09:30 GB GDP y/y (preliminary)
• 13:30 US Initial jobless claims
• 13:30 US Durable goods orders m/m
• 13:30 US Chicago Fed activity index
• 14:45 US Chicago PMI
• 14:55 US Michigan consumer confidence (final)
• 15:00 US Leading indicators
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ZAR outlook
USD/ZAR expected range: 10.0900 – 10.2300
The Rand has retreated against the USD this morning and at 08:45 GMT was more than 0.2% off it’s Tuesday close at R10.1440/$. The markets seem to be moving away from risky assets as investors are selling off local bonds, which is not good for the Rand. Combined with the poor GDP data released yesterday the ZAR has been struggling in the last two sessions.
Local news
SA’s Q3 GDP, released yesterday, increased by only 0.7% q/q which is below the general estimate of 1.0% and well below the Q2 figure of 2%, meaning that the 2013 growth target of 2% looks unachievable as well. Not only does this add pressure to the Rand but it also highlights the effects of the recent strikes that went on for weeks and warns of another low Q4 figure as, although mostly resolved, there are still some strikes on-going.
International news
The markets are relatively quiet, although trading volumes are still medium-high, as we approach the end of the year. With little key data due for release, the primary driver is speculation over the timing of the Fed taper, which keeps the pressure on the emerging market currencies.
TODAYS KEY DATA POINTS (GMT):
• 09:00 DE GfK consumer confidence
• 09:30 GB GDP y/y (preliminary)
• 13:30 US Initial jobless claims
• 13:30 US Durable goods orders m/m
• 13:30 US Chicago Fed activity index
• 14:45 US Chicago PMI
• 14:55 US Michigan consumer confidence (final)
• 15:00 US Leading indicators
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Tuesday 26 November 2013
ZAR maintaining ahead of local data release
Trade report 26/11/2013
ZAR outlook
USD/ZAR expected range: 10.0200 – 10.1700
The Rand has been trading in a relatively narrow band and this morning at 08:34 GMT was barely off Mondays close in New York, at R10.1000/$. Trading volumes were above the November average although news in the markets was fairly quiet with very little data being released.
Local news
Today sees the release of South Africa’s Q3 GDP which is most likely what the ZAR will take its direction from. Better than expected figures will certainly boost the currency although the figure is expected to come in at around 1.2% quarter-on-quarter expansion, which is weaker than the previous quarters growth at 3%. Recent strike action is one of the primary factors hampering the GDP growth and also has a negative effect on investor sentiment.
International news
With little key data from major economies due, the markets have adopted a “wait-and-see” approach and there is little information for markets to take direction from. November has been a tough month for “the fragile five” as the markets start to move away from risky assets. Foreigners have sold R13bn of local bonds month-to-date and these portfolio flows are not helping the Rands outlook.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA GDP q/q annualised
• 13:30 US Building permits
• 14:00 US S&P/Case=Shiller house price composite-20 y/y
• 14:00 US House price index m/m
• 15:00 US Consumer confidence
• 15:00 US Richmond Fed manufacturing index
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ZAR outlook
USD/ZAR expected range: 10.0200 – 10.1700
The Rand has been trading in a relatively narrow band and this morning at 08:34 GMT was barely off Mondays close in New York, at R10.1000/$. Trading volumes were above the November average although news in the markets was fairly quiet with very little data being released.
Local news
Today sees the release of South Africa’s Q3 GDP which is most likely what the ZAR will take its direction from. Better than expected figures will certainly boost the currency although the figure is expected to come in at around 1.2% quarter-on-quarter expansion, which is weaker than the previous quarters growth at 3%. Recent strike action is one of the primary factors hampering the GDP growth and also has a negative effect on investor sentiment.
International news
With little key data from major economies due, the markets have adopted a “wait-and-see” approach and there is little information for markets to take direction from. November has been a tough month for “the fragile five” as the markets start to move away from risky assets. Foreigners have sold R13bn of local bonds month-to-date and these portfolio flows are not helping the Rands outlook.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA GDP q/q annualised
• 13:30 US Building permits
• 14:00 US S&P/Case=Shiller house price composite-20 y/y
• 14:00 US House price index m/m
• 15:00 US Consumer confidence
• 15:00 US Richmond Fed manufacturing index
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Monday 25 November 2013
Rand hopes for a positive week
Trade report 25/11/2013
ZAR outlook
USD/ZAR expected range: 10.0200 – 10.1500
The ZAR managed to close off last week relatively steady against the USD after rather hawkish comments from the SARB which helped investor sentiment. This morning the Rand was trading at R10.0975/$ at 08:47, only slightly off Fridays close in New York. “Bullish global markets and a relatively empty international data calendar suggest this could be a positive week for the rand”, commented an analyst.
Local news
Last week Eskom, which provides 95% of South Africa’s electricity declared an emergency which knocked investor sentiment. But news that Eskom has lifted this emergency has helped the Rand get back on track. The SARB's hints that an interest rate hike is on the cards has also helped take the edge of the ZAR's recent underperformance.
International news
Talk of a EUR rebound has supported the Rand over the past day or so although the Fed taper remains the primary driver in the markets. But with little international data due for release this week, the taper speculation is unlikely to cause much volatility in the markets.
TODAYS KEY DATA POINTS (GMT):
• 00:15 EZ ECB’s Coeure speaks
• 15:00 US Pending home sales y/y
• 15:30 US Dallas Fed manufacturing activity
• 21:15 EZ ECB’s Weidmann speaks at Harvard
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ZAR outlook
USD/ZAR expected range: 10.0200 – 10.1500
The ZAR managed to close off last week relatively steady against the USD after rather hawkish comments from the SARB which helped investor sentiment. This morning the Rand was trading at R10.0975/$ at 08:47, only slightly off Fridays close in New York. “Bullish global markets and a relatively empty international data calendar suggest this could be a positive week for the rand”, commented an analyst.
Local news
Last week Eskom, which provides 95% of South Africa’s electricity declared an emergency which knocked investor sentiment. But news that Eskom has lifted this emergency has helped the Rand get back on track. The SARB's hints that an interest rate hike is on the cards has also helped take the edge of the ZAR's recent underperformance.
International news
Talk of a EUR rebound has supported the Rand over the past day or so although the Fed taper remains the primary driver in the markets. But with little international data due for release this week, the taper speculation is unlikely to cause much volatility in the markets.
TODAYS KEY DATA POINTS (GMT):
• 00:15 EZ ECB’s Coeure speaks
• 15:00 US Pending home sales y/y
• 15:30 US Dallas Fed manufacturing activity
• 21:15 EZ ECB’s Weidmann speaks at Harvard
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Friday 22 November 2013
Rand holding steady against the USD
Trade report 22/11/2013
ZAR outlook
USD/ZAR expected range: 10.0800 – 10.2100
After a volatile week for the ZAR, it is managing to hold steady against the USD today with news that, despite no change in interest rates yesterday, a rate hike had been discussed by the SARB. An increase in the interest rate would be seen as an attempt to reduce South Africa’s critical current account and budget deficits. The currency was trading at R10.1400/$ at 06:49GMT only slightly off the R10.1265/$ close in New York yesterday.
Local news
The SARB decided to leave interest rates unchanged at 5% yesterday as the economy is battling from weak economic growth and heightened inflation risks. However Governor Gill Marcus did mention that there had been a discussion of increasing the repo rate. This would help the strength of the ZAR especially with the uncertainty of QE tapering looming.
International news
It is likely to be a quiet days trading today with no key data due for release. The main driver in the markets at the moment is the speculation of QE tapering and this is most likely to remain the case as key events and data releases start winding down as the last month of the year approaches.
TODAYS KEY DATA POINTS (GMT):
• 07:00 SA Gill Marcus’ speech published on SARB website
• 09:30 SA ILB auction (R800mn)
• 07:00 DE GDP y/y nsa (final)
• 08:00 EZ ECB’s Noyer, Praet, Nowotny speak
• 09:00 DE IFO business climate
• 13:40 US Fed’s George speaks on banking supervision
• 16:00 US Kansas City manufacturing activity
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ZAR outlook
USD/ZAR expected range: 10.0800 – 10.2100
After a volatile week for the ZAR, it is managing to hold steady against the USD today with news that, despite no change in interest rates yesterday, a rate hike had been discussed by the SARB. An increase in the interest rate would be seen as an attempt to reduce South Africa’s critical current account and budget deficits. The currency was trading at R10.1400/$ at 06:49GMT only slightly off the R10.1265/$ close in New York yesterday.
Local news
The SARB decided to leave interest rates unchanged at 5% yesterday as the economy is battling from weak economic growth and heightened inflation risks. However Governor Gill Marcus did mention that there had been a discussion of increasing the repo rate. This would help the strength of the ZAR especially with the uncertainty of QE tapering looming.
International news
It is likely to be a quiet days trading today with no key data due for release. The main driver in the markets at the moment is the speculation of QE tapering and this is most likely to remain the case as key events and data releases start winding down as the last month of the year approaches.
TODAYS KEY DATA POINTS (GMT):
• 07:00 SA Gill Marcus’ speech published on SARB website
• 09:30 SA ILB auction (R800mn)
• 07:00 DE GDP y/y nsa (final)
• 08:00 EZ ECB’s Noyer, Praet, Nowotny speak
• 09:00 DE IFO business climate
• 13:40 US Fed’s George speaks on banking supervision
• 16:00 US Kansas City manufacturing activity
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Thursday 21 November 2013
FOMC minutes confirm QE tapering to happen "in the coming months"
Trade report 21/11/2013
ZAR outlook
USD/ZAR expected range: 10.1000 – 10.2500
The ZAR made strong gains late yesterday reaching a 2 and a half week high of R10.0515/$, but this morning dropped down to R10.1900 by 08:38GMT after the FOMC October minutes pointed to the start of QE tapering in the coming months. The Chinese flash manufacturing PMI data released yesterday will also likely add pressure to EM currencies.
Local news
Local news today is mostly focussed on the SARB policy decision statement at its final policy meeting of the year. With the Rand under pressure due to Fed tapering expectations, domestic prices including petrol will be on the increase. General feeling is that the SARB will leave interest rates unchanged despite weak economic growth.
International news
EM currencies are feeling some strain after their two to three weeks of recovery as the FOMC minutes confirmed general feeling that QE tapering will begin in the next few months. Added to this Chinese PMI data dropped from 50.9 to 50.4 which will add pressure to commodity linked currencies such as the ZAR and the AUD.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA Switch auction
• 13:00 SA SARB rate announcement
• 08:30 DE PMI manufacturing (advance)
• 09:00 EZ PMI manufacturing (advance)
• 13:30 US Initial jobless claims
• 13:30 US PPI y/y
• 13:58 US Markit PMI manufacturing
• 15:00 US Philadelphia Fed index
• 15:00 EZ Consumer confidence (advance)
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ZAR outlook
USD/ZAR expected range: 10.1000 – 10.2500
The ZAR made strong gains late yesterday reaching a 2 and a half week high of R10.0515/$, but this morning dropped down to R10.1900 by 08:38GMT after the FOMC October minutes pointed to the start of QE tapering in the coming months. The Chinese flash manufacturing PMI data released yesterday will also likely add pressure to EM currencies.
Local news
Local news today is mostly focussed on the SARB policy decision statement at its final policy meeting of the year. With the Rand under pressure due to Fed tapering expectations, domestic prices including petrol will be on the increase. General feeling is that the SARB will leave interest rates unchanged despite weak economic growth.
International news
EM currencies are feeling some strain after their two to three weeks of recovery as the FOMC minutes confirmed general feeling that QE tapering will begin in the next few months. Added to this Chinese PMI data dropped from 50.9 to 50.4 which will add pressure to commodity linked currencies such as the ZAR and the AUD.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA Switch auction
• 13:00 SA SARB rate announcement
• 08:30 DE PMI manufacturing (advance)
• 09:00 EZ PMI manufacturing (advance)
• 13:30 US Initial jobless claims
• 13:30 US PPI y/y
• 13:58 US Markit PMI manufacturing
• 15:00 US Philadelphia Fed index
• 15:00 EZ Consumer confidence (advance)
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Wednesday 20 November 2013
ZAR retreats as news of Eskom power emergency breaks
Trade report 20/11/2013
ZAR outlook
USD/ZAR expected range: 10.1300 – 10.2700
News of Eskoms power emergency has brought the ZAR’s steady recovery to an end, as the local currency dropped to R10.2000/$ after the news broke. This morning the Rand was down to R10.2120 in early trade. The USD is also under pressure as the Fed chief Bernanke comments yesterday fell in line with those of soon-to-be chairwoman Yellen.
Local news
Eskom, which provides 95% of South Africa’s electricity declared a power emergency late yesterday and urged industrial customers to reduce power use. It also warned that there is a chance that rolling black-outs may have to be re-introduced. This news not only dampens investor sentiment but also poses a threat to SA’s overall GDP.
International news
While the ZAR struggles with news of the Eskom power emergency, other EMs continue to recover against a steadily softening USD due to mounting expectation of a doveish stance towards QE tapering. There is much US data still to be released this week as well as Fed minutes which investors will be keenly awaiting as they try to gauge the timing of the taper.
TODAYS KEY DATA POINTS (GMT):
• 08:00 SA CPI y/y
• 09:30 GB BoE releases MPC minutes
• 13:30 US Retail sales excluding auto and gas m/m
• 13:30 US CPI y/y
• 15:00 US Fed’s Dudley to speak on economy
• 15:00 US Existing home sales
• 15:00 US Business inventories m/m
• 17:10 US Fed’s Bullard speaks
• 19:00 US Fed releases minutes from October 29-30 FOMC
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ZAR outlook
USD/ZAR expected range: 10.1300 – 10.2700
News of Eskoms power emergency has brought the ZAR’s steady recovery to an end, as the local currency dropped to R10.2000/$ after the news broke. This morning the Rand was down to R10.2120 in early trade. The USD is also under pressure as the Fed chief Bernanke comments yesterday fell in line with those of soon-to-be chairwoman Yellen.
Local news
Eskom, which provides 95% of South Africa’s electricity declared a power emergency late yesterday and urged industrial customers to reduce power use. It also warned that there is a chance that rolling black-outs may have to be re-introduced. This news not only dampens investor sentiment but also poses a threat to SA’s overall GDP.
International news
While the ZAR struggles with news of the Eskom power emergency, other EMs continue to recover against a steadily softening USD due to mounting expectation of a doveish stance towards QE tapering. There is much US data still to be released this week as well as Fed minutes which investors will be keenly awaiting as they try to gauge the timing of the taper.
TODAYS KEY DATA POINTS (GMT):
• 08:00 SA CPI y/y
• 09:30 GB BoE releases MPC minutes
• 13:30 US Retail sales excluding auto and gas m/m
• 13:30 US CPI y/y
• 15:00 US Fed’s Dudley to speak on economy
• 15:00 US Existing home sales
• 15:00 US Business inventories m/m
• 17:10 US Fed’s Bullard speaks
• 19:00 US Fed releases minutes from October 29-30 FOMC
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Tuesday 19 November 2013
Rand enjoying recovery period
Trade report 19/11/2013
ZAR outlook
USD/ZAR expected range: 10.1100 – 10.2500
The Rand has continued it’s recovery against the USD after last week’s slide and at 06:37GMT this morning was trading at R10.1450/$, the level it closed at on Monday evening. With the markets having turned towards riskier emerging markets this is particularly evident as 4 out of the top 5 performers over the past week have been the BRL, INR, ZAR and TRY, all characterized as part of the “Fragile 5.”
Local news
The ZAR is enjoying a period of recovery after reaching a low of R10.4600/$ a week ago. Despite this the Rand remains vulnerable due to its large twin deficits and with the SARB likely to leave interest rates low for the meantime, the ZAR will continue to struggle when market sentiment turns away from risky assets.
International news
EM currencies are enjoying a period of less pressure as news of economic reform from China helps boost riskier markets and general market feeling is that of a doveish Fed. Today is likely to be a quieter day as investors await the next round of Fed speakers as well as US data releases and SA’s CPI data release on Wednesday.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA Bond auction (R2048 – R950mn; R2030 – R450mn; R214 – R950mn)
• 10:00 SA BER business confidence
• 08:30 EZ ECB’s Praet, EBA’s Enria speak
• 10:00 EZ Construction output wda y/y
• 10:00 EZ ZEW economic sentiment
• 10:00 EZ ZEW economic sentiment
• 19:15 US Fed’s Evans speaks to bankers in Chicago
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ZAR outlook
USD/ZAR expected range: 10.1100 – 10.2500
The Rand has continued it’s recovery against the USD after last week’s slide and at 06:37GMT this morning was trading at R10.1450/$, the level it closed at on Monday evening. With the markets having turned towards riskier emerging markets this is particularly evident as 4 out of the top 5 performers over the past week have been the BRL, INR, ZAR and TRY, all characterized as part of the “Fragile 5.”
Local news
The ZAR is enjoying a period of recovery after reaching a low of R10.4600/$ a week ago. Despite this the Rand remains vulnerable due to its large twin deficits and with the SARB likely to leave interest rates low for the meantime, the ZAR will continue to struggle when market sentiment turns away from risky assets.
International news
EM currencies are enjoying a period of less pressure as news of economic reform from China helps boost riskier markets and general market feeling is that of a doveish Fed. Today is likely to be a quieter day as investors await the next round of Fed speakers as well as US data releases and SA’s CPI data release on Wednesday.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA Bond auction (R2048 – R950mn; R2030 – R450mn; R214 – R950mn)
• 10:00 SA BER business confidence
• 08:30 EZ ECB’s Praet, EBA’s Enria speak
• 10:00 EZ Construction output wda y/y
• 10:00 EZ ZEW economic sentiment
• 10:00 EZ ZEW economic sentiment
• 19:15 US Fed’s Evans speaks to bankers in Chicago
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Monday 18 November 2013
Rand off to a steady start for the week
Trade report 18/11/2013
ZAR outlook
USD/ZAR expected range: 10.1100 – 10.2500
The Rand has managed to remain steady against the USD over the week-end and this morning at 09:00GMT was trading at R10.1600/$, much the same as it’s close in New York on Friday evening. General feeling at the moment is that the market is favouring high yielding emerging market assets which should take the pressure off the Rand for the moment.
Local news
With South Africas trade deficit having been drastically reduced last week, it will be interesting to note what the SARB will announce when it’s rate decision is released on Thursday at its last policy meeting for the year. General feeling is that the interest rate will remain unchanged with the market already having priced in a “no change” stance.
International news
Internationally the week ahead looks to be dominated by US data releases as well as numerous Fed members due to speak. News out of China which is seen as pro-market will be good news to emerging markets as EM currencies look to take back some of their losses over the past two weeks.
TODAYS KEY DATA POINTS (GMT):
• 10:00 SA BER consumer confidence
• 09:00 EZ Current account sa (EUR)
• 10:00 EZ Trade balance sa (EUR)
• 14:00 US Net long term TIC flows (USD
• 15:00 US NAHB Housing market index
• 17:15 US Fed’s Dudley speaks
• 18:30 US Fed’s Plosser speaks
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ZAR outlook
USD/ZAR expected range: 10.1100 – 10.2500
The Rand has managed to remain steady against the USD over the week-end and this morning at 09:00GMT was trading at R10.1600/$, much the same as it’s close in New York on Friday evening. General feeling at the moment is that the market is favouring high yielding emerging market assets which should take the pressure off the Rand for the moment.
Local news
With South Africas trade deficit having been drastically reduced last week, it will be interesting to note what the SARB will announce when it’s rate decision is released on Thursday at its last policy meeting for the year. General feeling is that the interest rate will remain unchanged with the market already having priced in a “no change” stance.
International news
Internationally the week ahead looks to be dominated by US data releases as well as numerous Fed members due to speak. News out of China which is seen as pro-market will be good news to emerging markets as EM currencies look to take back some of their losses over the past two weeks.
TODAYS KEY DATA POINTS (GMT):
• 10:00 SA BER consumer confidence
• 09:00 EZ Current account sa (EUR)
• 10:00 EZ Trade balance sa (EUR)
• 14:00 US Net long term TIC flows (USD
• 15:00 US NAHB Housing market index
• 17:15 US Fed’s Dudley speaks
• 18:30 US Fed’s Plosser speaks
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Friday 15 November 2013
Rand holds onto recent gains
Trade report 15/11/2013
ZAR outlook
USD/ZAR expected range: 10.2100 – 10.3500
The Rand has managed to hold onto its recent gains and this morning was trading at R10.2000/$, up from its local close yesterday of R10.3500/$. Janet Yellen’s dovish comments and the good news that SA has adjusted its trade balance calculations which now shows a trade deficit of R34.6bn from the previous R116.9bn, has helped the ZAR firm up.
Local news
SARS has announced that the SA trade deficit is due to be cut almost in half. The inclusion of trade numbers with SA’s neighbours, Botswana, Lesotho, Namibia and Swaziland, has helped boost the trade figures, which although still uncomfortably large, should have a large impact on the current account balance when the Q3 data is released in December.
International news
US data released yesterday had little impact in the markets as the Feds comments about the state of the economy and the timing of QE tapering were the main focus of the day. This was good news for risky emerging market currencies which enjoyed a day of buoyed trading.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA ILB auction (R800mn)
• 10:00 EZ CPI y/y (final)
• 13:30 US Empire manufacturing
• 13:30 US Import price index
• 14:15 US Industrial production m/m
• 15:00 US Wholesale inventories
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ZAR outlook
USD/ZAR expected range: 10.2100 – 10.3500
The Rand has managed to hold onto its recent gains and this morning was trading at R10.2000/$, up from its local close yesterday of R10.3500/$. Janet Yellen’s dovish comments and the good news that SA has adjusted its trade balance calculations which now shows a trade deficit of R34.6bn from the previous R116.9bn, has helped the ZAR firm up.
Local news
SARS has announced that the SA trade deficit is due to be cut almost in half. The inclusion of trade numbers with SA’s neighbours, Botswana, Lesotho, Namibia and Swaziland, has helped boost the trade figures, which although still uncomfortably large, should have a large impact on the current account balance when the Q3 data is released in December.
International news
US data released yesterday had little impact in the markets as the Feds comments about the state of the economy and the timing of QE tapering were the main focus of the day. This was good news for risky emerging market currencies which enjoyed a day of buoyed trading.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA ILB auction (R800mn)
• 10:00 EZ CPI y/y (final)
• 13:30 US Empire manufacturing
• 13:30 US Import price index
• 14:15 US Industrial production m/m
• 15:00 US Wholesale inventories
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Thursday 14 November 2013
Fed comments help ZAR firm up
Trade report 14/11/2013
ZAR outlook
USD/ZAR expected range: 10.2100 – 10.3500
Janet Yellen’s comments yesterday that the economy and labour market are “performing far short of their potential” and must improve before the Fed can start QE tapering have helped the Rand show some much needed gains after a poor start to the week. The ZAR was trading at R10.3025/$ at 08:55GMT with scope for some modest gains today.
Local news
Progress in wage negotiations have helped the ZAR claw back slightly. News that the unions and mining companies are a step closer to reaching a compromise over wages has helped investor sentiment and in turn helped the struggling Rand recover during what has been a tough week for emerging markets.
International news
The ZAR has been allowed a slight recovery due to the doveishness of the Feds Janet Yellen’s comments, but gains have been only moderate as the broader market does not yet feel convinced about the timing of QE tapering. Should investors see more evidence of this, we would expect to see a much firmer recovery by the ZAR.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA Switch auction (Source:R201 – Destination:R186 – R500mn)
• 07:00 DE GDP y/y nsa (preliminary)
• 09:00 EZ ECB publishes Monthly report
• 09:30 GB Retail sales excluding auto fuel y/y
• 10:00 EZ GDP sa y/y (advance)
• 13:30 US Initial jobless claims
• 13:30 US Trade balance (USD)
• 15:00 US Senate confirmation hearing for Fed’s Yellen
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ZAR outlook
USD/ZAR expected range: 10.2100 – 10.3500
Janet Yellen’s comments yesterday that the economy and labour market are “performing far short of their potential” and must improve before the Fed can start QE tapering have helped the Rand show some much needed gains after a poor start to the week. The ZAR was trading at R10.3025/$ at 08:55GMT with scope for some modest gains today.
Local news
Progress in wage negotiations have helped the ZAR claw back slightly. News that the unions and mining companies are a step closer to reaching a compromise over wages has helped investor sentiment and in turn helped the struggling Rand recover during what has been a tough week for emerging markets.
International news
The ZAR has been allowed a slight recovery due to the doveishness of the Feds Janet Yellen’s comments, but gains have been only moderate as the broader market does not yet feel convinced about the timing of QE tapering. Should investors see more evidence of this, we would expect to see a much firmer recovery by the ZAR.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA Switch auction (Source:R201 – Destination:R186 – R500mn)
• 07:00 DE GDP y/y nsa (preliminary)
• 09:00 EZ ECB publishes Monthly report
• 09:30 GB Retail sales excluding auto fuel y/y
• 10:00 EZ GDP sa y/y (advance)
• 13:30 US Initial jobless claims
• 13:30 US Trade balance (USD)
• 15:00 US Senate confirmation hearing for Fed’s Yellen
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Wednesday 13 November 2013
Rand steadies after heavy losses yesterday
Trade report 13/11/2013
ZAR outlook
USD/ZAR expected range: 10.2600 – 10.4100
The ZAR has managed to firm up this morning after dropping to an eleven week low yesterday as QE tapering speculation grew. By 06:35 GMT this morning the ZAR has reached R10.3355/$, up 0.3% from its close in New York yesterday evening. The Fed’s Lockhards and Kocherlakota comments came across rather dovishly yesterday evening which helped the ZAR steady against the USD.
Local news
Local Retail sales data is due for release today and is expected to reveal a slowdown from 3% y/y to 2.5% as consumers are struggling with debt and reluctant to take on additional credit. This may reinforce expectations that the SARB will be reluctant to increase interest rates, which leaves the ZAR exposed in the medium term due to its large current account and budget deficits.
International news
It is expected to be a relatively quiet day in the markets with further US data only due for release from tomorrow. Emerging currencies have managed to firm up in overnight trade as the Feds speakers hinted that an early taper would hurt the already slow economic recovery, although negative sentiment out of China has meant that the EMs gains have been limited.
TODAYS KEY DATA POINTS (GMT):
• 11:00 SA Retail sales constant y/y
• 09:30 GB ILO unemployment rate (3mths)
• 10:00 EZ Industrial production (wda) y/y
• 10:30 GB BoE releases Inflation Report
• 12:00 US MBA mortgage applications
• 13:45 US Fed’s Pianalto speaks
• 19:00 US Monthly budget statement
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ZAR outlook
USD/ZAR expected range: 10.2600 – 10.4100
The ZAR has managed to firm up this morning after dropping to an eleven week low yesterday as QE tapering speculation grew. By 06:35 GMT this morning the ZAR has reached R10.3355/$, up 0.3% from its close in New York yesterday evening. The Fed’s Lockhards and Kocherlakota comments came across rather dovishly yesterday evening which helped the ZAR steady against the USD.
Local news
Local Retail sales data is due for release today and is expected to reveal a slowdown from 3% y/y to 2.5% as consumers are struggling with debt and reluctant to take on additional credit. This may reinforce expectations that the SARB will be reluctant to increase interest rates, which leaves the ZAR exposed in the medium term due to its large current account and budget deficits.
International news
It is expected to be a relatively quiet day in the markets with further US data only due for release from tomorrow. Emerging currencies have managed to firm up in overnight trade as the Feds speakers hinted that an early taper would hurt the already slow economic recovery, although negative sentiment out of China has meant that the EMs gains have been limited.
TODAYS KEY DATA POINTS (GMT):
• 11:00 SA Retail sales constant y/y
• 09:30 GB ILO unemployment rate (3mths)
• 10:00 EZ Industrial production (wda) y/y
• 10:30 GB BoE releases Inflation Report
• 12:00 US MBA mortgage applications
• 13:45 US Fed’s Pianalto speaks
• 19:00 US Monthly budget statement
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Tuesday 12 November 2013
ZAR retreats as talk of QE tapering increases
Trade report 12/11/2013
ZAR outlook
USD/ZAR expected range: 10.3100 – 10.4400
It was a day of light trading volumes yesterday as the US celebrated Veterans Day, but as talk around the Fed introducing QE tapering before March next year increases, the pressure on risky assets including the Rand is growing. The ZAR had dropped to R10.4010/$ at 04:54 this morning, nearly 0.2% down from its close in New York yesterday and near its lowest level in 2 months.
Local news
The ZAR remains as fragile as ever, with its increasing current account budget deficits being a major vulnerable point. With an election year ahead, chances of the govt increasing interest rates are low. This in turn adds to the twin deficit issue, meaning this economic imbalance will most likely be a hindrance to the local currency well into the medium term.
International news
With speeches from two Fed members schedule for later today investors will be watching for any hints around the timing of QE tapering, after employment numbers released on Friday came in stronger than expected. Should the Fed comments be dovish, this may help steady the emerging market currencies currently under pressure.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA Bond auction (R2023 – R1bn; R2030 – R400mn; R214 – R950mn)
• 07:00 DE CPI y/y (final)
• 09:00 US Fed’s Fisher speaks on monetary policy
• 09:30 GB PPI output core y/y n.s.a
• 09:30 GB CPI y/y
• 13:30 US Chicago Fed activity index
• 18:00 US Fed’s Kocherlakota speaks on monetary policy
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ZAR outlook
USD/ZAR expected range: 10.3100 – 10.4400
It was a day of light trading volumes yesterday as the US celebrated Veterans Day, but as talk around the Fed introducing QE tapering before March next year increases, the pressure on risky assets including the Rand is growing. The ZAR had dropped to R10.4010/$ at 04:54 this morning, nearly 0.2% down from its close in New York yesterday and near its lowest level in 2 months.
Local news
The ZAR remains as fragile as ever, with its increasing current account budget deficits being a major vulnerable point. With an election year ahead, chances of the govt increasing interest rates are low. This in turn adds to the twin deficit issue, meaning this economic imbalance will most likely be a hindrance to the local currency well into the medium term.
International news
With speeches from two Fed members schedule for later today investors will be watching for any hints around the timing of QE tapering, after employment numbers released on Friday came in stronger than expected. Should the Fed comments be dovish, this may help steady the emerging market currencies currently under pressure.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA Bond auction (R2023 – R1bn; R2030 – R400mn; R214 – R950mn)
• 07:00 DE CPI y/y (final)
• 09:00 US Fed’s Fisher speaks on monetary policy
• 09:30 GB PPI output core y/y n.s.a
• 09:30 GB CPI y/y
• 13:30 US Chicago Fed activity index
• 18:00 US Fed’s Kocherlakota speaks on monetary policy
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Monday 11 November 2013
Rand under pressure vs. buoyed USD
Trade report 011/11/2013
ZAR outlook
USD/ZAR expected range: 10.2600 – 10.3800
The ZAR is managing to stay relatively steady this morning after it took a knock on Friday afternoon. US payrolls data came in much stronger than expected, boosting the USD and putting pressure on emerging markets. At 06:25 GMT the Rand was trading around R10.3350/$ and looked to stay within the wide range of 10.2250 and 10.4050 in today’s quieter session.
Local news
The ZAR remains under pressure with recent local data pointing to a rather bleak view around growth trajectory and the wide current account deficit. Retail sales data is due for release this week and is expected to confirm this. On-going mining labour unrest also continues to hamper investor sentiment, and is one of the main contributors to the Rands 22% drop against the greenback so far this year.
International news
The positive US data released last week has spurred on the argument that the FED may introduce QE tapering earlier than the expected March next year. This would add to the pressure on the already vulnerable emerging markets.
TODAYS KEY DATA POINTS (GMT):
• 08:00 SA SARB Dep. Gov. Mminele remarks published on SARB website
• US Veterans Day (stock markets open, bond markets closed)
• O/N JP Current account total (JPY)
• O/N JP Trade balance (JPY)
• 17:00 EZ ECB’s Weidmann speaks
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ZAR outlook
USD/ZAR expected range: 10.2600 – 10.3800
The ZAR is managing to stay relatively steady this morning after it took a knock on Friday afternoon. US payrolls data came in much stronger than expected, boosting the USD and putting pressure on emerging markets. At 06:25 GMT the Rand was trading around R10.3350/$ and looked to stay within the wide range of 10.2250 and 10.4050 in today’s quieter session.
Local news
The ZAR remains under pressure with recent local data pointing to a rather bleak view around growth trajectory and the wide current account deficit. Retail sales data is due for release this week and is expected to confirm this. On-going mining labour unrest also continues to hamper investor sentiment, and is one of the main contributors to the Rands 22% drop against the greenback so far this year.
International news
The positive US data released last week has spurred on the argument that the FED may introduce QE tapering earlier than the expected March next year. This would add to the pressure on the already vulnerable emerging markets.
TODAYS KEY DATA POINTS (GMT):
• 08:00 SA SARB Dep. Gov. Mminele remarks published on SARB website
• US Veterans Day (stock markets open, bond markets closed)
• O/N JP Current account total (JPY)
• O/N JP Trade balance (JPY)
• 17:00 EZ ECB’s Weidmann speaks
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Friday 8 November 2013
Cautious trading ahead of US Nonfarm Payrolls release
Trade report 08/11/2013
ZAR outlook
USD/ZAR expected range: 10.1800 – 10.3400
In an unexpected move yesterday, the ECB cut interest rates. This and the soft SA mining and manufacturing data released yesterday helped push the ZAR to its lowest level in more than 2 months. The Rand closed at R10.2925/$ last night but steadied this morning as investors cautiously await the key US non-farm payrolls data due out later today.
Local news
Both mining and manufacturing data came in well below consensus estimates. This data helps highlight the negative effect the strike action has on the local industries, but will also more than likely mean the SARB will keep interest rates low for the medium term to promote growth. This leaves the ZAR exposed due to its economic imbalances.
International news
US Initial jobless claims and GDP q/q data released out of the US yesterday came in firmer than expected pointing towards a firming of QE tapering expectations and boosting the USD, however investors are trading cautiously today ahead of the key non-Farm payrolls data due for release later in the day.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA ILB auction (R800mn)
• 07:00 DE Trade balance (EUR)
• 09:30 GB Visible trade balance (GBP)
• 13:30 US Nonfarm payrolls
• 13:30 US Unemployment rate
• 13:30 US PCE core y/y
• 14:55 US Michigan consumer confidence (preliminary)
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ZAR outlook
USD/ZAR expected range: 10.1800 – 10.3400
In an unexpected move yesterday, the ECB cut interest rates. This and the soft SA mining and manufacturing data released yesterday helped push the ZAR to its lowest level in more than 2 months. The Rand closed at R10.2925/$ last night but steadied this morning as investors cautiously await the key US non-farm payrolls data due out later today.
Local news
Both mining and manufacturing data came in well below consensus estimates. This data helps highlight the negative effect the strike action has on the local industries, but will also more than likely mean the SARB will keep interest rates low for the medium term to promote growth. This leaves the ZAR exposed due to its economic imbalances.
International news
US Initial jobless claims and GDP q/q data released out of the US yesterday came in firmer than expected pointing towards a firming of QE tapering expectations and boosting the USD, however investors are trading cautiously today ahead of the key non-Farm payrolls data due for release later in the day.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA ILB auction (R800mn)
• 07:00 DE Trade balance (EUR)
• 09:30 GB Visible trade balance (GBP)
• 13:30 US Nonfarm payrolls
• 13:30 US Unemployment rate
• 13:30 US PCE core y/y
• 14:55 US Michigan consumer confidence (preliminary)
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Thursday 7 November 2013
ZAR steady ahead of key data releases
Trade report 07/11/2013
ZAR outlook
USD/ZAR expected range: 10.1800 – 10.3300
The ZAR has been trading in a narrow range and at 08:43 GMT was at R10.2760/$, very close to its R10.2630 close in New York yesterday evening. It is generally thought that the Rand will remain steady as investors await key data releases scheduled for later today – the US Jobless claims, Q3 GDP and the BoE rate announcement.
Local news
The Rand remains vulnerable and prone to underperformance due to weak structural factors such as a wide current account and budget account deficit. On-going mining strikes and violence are knocking investor confidence, although focus today will be on domestic output data for the mining and manufacturing sectors in September.
International news
With investor confidence in the ZAR on the decline, economists will be watching the key international data due out today. Soft US data will add to the argument for the pushing out of QE tapering expectations and maybe help keep the Rand steady for the moment.
TODAYS KEY DATA POINTS (GMT):
• 06:00 SA Net reserves (USD)
• 09:30 SA Switch auction
• 09:30 SA Mining production y/y
• 11:00 DE Industrial production y/y
• 12:00 GB BoE rate announcement
• 12:45 EZ ECB rate announcement
• 13:30 US Initial jobless claims
• 13:30 US GDP q/q annualized (advanced)
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ZAR outlook
USD/ZAR expected range: 10.1800 – 10.3300
The ZAR has been trading in a narrow range and at 08:43 GMT was at R10.2760/$, very close to its R10.2630 close in New York yesterday evening. It is generally thought that the Rand will remain steady as investors await key data releases scheduled for later today – the US Jobless claims, Q3 GDP and the BoE rate announcement.
Local news
The Rand remains vulnerable and prone to underperformance due to weak structural factors such as a wide current account and budget account deficit. On-going mining strikes and violence are knocking investor confidence, although focus today will be on domestic output data for the mining and manufacturing sectors in September.
International news
With investor confidence in the ZAR on the decline, economists will be watching the key international data due out today. Soft US data will add to the argument for the pushing out of QE tapering expectations and maybe help keep the Rand steady for the moment.
TODAYS KEY DATA POINTS (GMT):
• 06:00 SA Net reserves (USD)
• 09:30 SA Switch auction
• 09:30 SA Mining production y/y
• 11:00 DE Industrial production y/y
• 12:00 GB BoE rate announcement
• 12:45 EZ ECB rate announcement
• 13:30 US Initial jobless claims
• 13:30 US GDP q/q annualized (advanced)
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Wednesday 6 November 2013
Fed comments help a softening Rand
Trade report 06/11/2013
ZAR outlook
USD/ZAR expected range: 10.1600 – 10.3300
The Rand dropped significantly against the USD yesterday and closed the day at R10.2460/$. Dovish remarks by two Federal Reserve officials mentioning subdued growth in the US economy, have since helped prop the ZAR up, and this morning at 06:45 GMT the Rand had recovered by 0.4% to R10.2025/$.
Local news
On-going strike action and fears that the mining strike will spread across the platinum industry are knocking investor sentiment in the ZAR. SACCI Business Confidence data for October is also due for release today and it will be interesting to note if it has moved up from September. Last month’s figures had moved up, but were still low compared to last year.
International news
Recent dovish remarks by the Federal Reserve’s Williams and Lacker have added to speculation that the Fed will hold off on QE tapering until at least March of next year. Although, traders will be watching for this week’s US employment data as if it comes in stronger than expected it could put renewed pressure on the Rand.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA SACCI Business Confidence
• 08:55 DE PMI services (final)
• 09:00 EZ PMI services (final)
• 10:00 EZ Retail sales y/y
• 11:00 DE Factory orders y/y
• 12:00 US MBA mortgage applications
• 15:00 US Leading indicators
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ZAR outlook
USD/ZAR expected range: 10.1600 – 10.3300
The Rand dropped significantly against the USD yesterday and closed the day at R10.2460/$. Dovish remarks by two Federal Reserve officials mentioning subdued growth in the US economy, have since helped prop the ZAR up, and this morning at 06:45 GMT the Rand had recovered by 0.4% to R10.2025/$.
Local news
On-going strike action and fears that the mining strike will spread across the platinum industry are knocking investor sentiment in the ZAR. SACCI Business Confidence data for October is also due for release today and it will be interesting to note if it has moved up from September. Last month’s figures had moved up, but were still low compared to last year.
International news
Recent dovish remarks by the Federal Reserve’s Williams and Lacker have added to speculation that the Fed will hold off on QE tapering until at least March of next year. Although, traders will be watching for this week’s US employment data as if it comes in stronger than expected it could put renewed pressure on the Rand.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA SACCI Business Confidence
• 08:55 DE PMI services (final)
• 09:00 EZ PMI services (final)
• 10:00 EZ Retail sales y/y
• 11:00 DE Factory orders y/y
• 12:00 US MBA mortgage applications
• 15:00 US Leading indicators
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Tuesday 5 November 2013
Rand trading slightly firmer
Trade report 05/11/2013
ZAR outlook
USD/ZAR expected range: 10.0700 – 10.2100
The ZAR managed to firm up slightly yesterday after a quiet start to the week as European data released yesterday did not have any real impact in the markets. The Rand was at R10.1465/$ at 08:20 GMT, slightly down from its overnight close, but firmer that it’s R10.2145 low of yesterday.
Local news
It is important to note that despite trading slightly firmer in the past day or so, that the ZAR remains the third worst performing EM currency on the week. Added to South Africa’s twin deficits the renewed bout of strike action is adding to the ZARs woes, as it is knocking investor confidence in the currency. Another concern to investors is the lapse of SA’s investment treaties with some of its EU trading parties as the replacement law does not offer the same protection.
International news
Recent manufacturing data out of some of the major economies tends towards confirming a gradual improvement in the growth trajectory. While this is positive news, it also leaves investors nervous that the Fed may look to start its QE tapering earlier than March next year.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA Bond auction
• 08:00 EZ ECB’s Constancio speaks
• 09:30 GB PMI services
• 10:00 EZ PPI y/y
• 13:30 EZ ECB President Draghi speaks
• 14:00 EZ ECB’s Asmussen speaks in Berlin
• 15:00 US ISM non-manufacturing composite
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ZAR outlook
USD/ZAR expected range: 10.0700 – 10.2100
The ZAR managed to firm up slightly yesterday after a quiet start to the week as European data released yesterday did not have any real impact in the markets. The Rand was at R10.1465/$ at 08:20 GMT, slightly down from its overnight close, but firmer that it’s R10.2145 low of yesterday.
Local news
It is important to note that despite trading slightly firmer in the past day or so, that the ZAR remains the third worst performing EM currency on the week. Added to South Africa’s twin deficits the renewed bout of strike action is adding to the ZARs woes, as it is knocking investor confidence in the currency. Another concern to investors is the lapse of SA’s investment treaties with some of its EU trading parties as the replacement law does not offer the same protection.
International news
Recent manufacturing data out of some of the major economies tends towards confirming a gradual improvement in the growth trajectory. While this is positive news, it also leaves investors nervous that the Fed may look to start its QE tapering earlier than March next year.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA Bond auction
• 08:00 EZ ECB’s Constancio speaks
• 09:30 GB PMI services
• 10:00 EZ PPI y/y
• 13:30 EZ ECB President Draghi speaks
• 14:00 EZ ECB’s Asmussen speaks in Berlin
• 15:00 US ISM non-manufacturing composite
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Monday 4 November 2013
Strikes weigh on investor sentiment
Trade report 04/11/2013
ZAR outlook
USD/ZAR expected range: 10.0911 – 10.2200
The ZAR finished off last week on the back foot due to a buoyed USD and soft SA data releases. As we start off a new week the Rand continues to struggle as fears of further mining strikes knocks investor confidence. The Rand is currently trading near 8 week lows and at 05:57GMT was R10.1605/$, very close to its close in New York on Friday evening.
Local news
In local news workers from the National Union of Mineworkers have gone on strike over wages at mid-tier producer Northam Platinum. There is a fear of further strikes starting at Anglo American Platinum, Impala Platinum and Lonmin by the Association of Mineworkers and Construction Union. This news adds to negative investor sentiment and increases pressure on an already vulnerable Rand.
International news
Fed QE tapering expectations are one of the main topics in the markets at the moment with the general feeling that it won’t begin before March 2013. With this in mind, the week ahead will be a significant one with ECB and BoE policy meetings scheduled as well as numerous Fed officials due to speak and US Q3 GDP data due for release.
TODAYS KEY DATA POINTS (GMT):
• 09:00 EZ PMI Manufacturing (final)
• 09:30 EZ Sentix investor confidence
• 09:30 GB PMI construction
• 11:30 EZ ECB’s Asmussen speaks
• 14:45 US ISM New York
• 15:00 US Factory orders y/y
• 16:20 US Fed’s Powell speaks
• 21:00 US Fed’s Rosengren speaks
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ZAR outlook
USD/ZAR expected range: 10.0911 – 10.2200
The ZAR finished off last week on the back foot due to a buoyed USD and soft SA data releases. As we start off a new week the Rand continues to struggle as fears of further mining strikes knocks investor confidence. The Rand is currently trading near 8 week lows and at 05:57GMT was R10.1605/$, very close to its close in New York on Friday evening.
Local news
In local news workers from the National Union of Mineworkers have gone on strike over wages at mid-tier producer Northam Platinum. There is a fear of further strikes starting at Anglo American Platinum, Impala Platinum and Lonmin by the Association of Mineworkers and Construction Union. This news adds to negative investor sentiment and increases pressure on an already vulnerable Rand.
International news
Fed QE tapering expectations are one of the main topics in the markets at the moment with the general feeling that it won’t begin before March 2013. With this in mind, the week ahead will be a significant one with ECB and BoE policy meetings scheduled as well as numerous Fed officials due to speak and US Q3 GDP data due for release.
TODAYS KEY DATA POINTS (GMT):
• 09:00 EZ PMI Manufacturing (final)
• 09:30 EZ Sentix investor confidence
• 09:30 GB PMI construction
• 11:30 EZ ECB’s Asmussen speaks
• 14:45 US ISM New York
• 15:00 US Factory orders y/y
• 16:20 US Fed’s Powell speaks
• 21:00 US Fed’s Rosengren speaks
Foreign exchange South Africa – Let one of our professional consultants at Currency Solutions assist you. To know more about how we can help you Contact Us
Want to know where the markets are? View our Live Currency Rates
Friday 1 November 2013
Rand on the backfoot after disappointing trade release
Trade report 01/11/2013
ZAR outlook
USD/ZAR expected range: 9.9500 – 10.1500
After enjoying a period of relative stability and firm trading the ZAR was trading near a one month low this morning and breached the R10/$ level. The Rand is battling disappointing SA data and a greenback buoyed by upbeat US data released yesterday. The Rand was R10.0400/$ at 08:36 GMT, 0.2% firmer than its close in New York yesterday evening.
Local news
Trade data released yesterday revealed that the deficit narrowed by a smaller margin than the markets were expecting. The cumulative trade deficit for 2013 now stands at R126.37bn, compared to R83.6bn in 2012 meaning the ZAR will most likely be reliant on external funding for a while to come still.
International news
Strong US Chicago PMI data contributed to the good day for the USD. The PMI rose from 55.7 to 65.9 which surprised the markets as they were expecting a reading closer to 55.0. This, combined with the disappointing local data meant the Rand took strain and hit a low of 10.0695 – it’s weakest level since the beginning of October.
TODAYS KEY DATA POINTS (GMT):
• 09:00 SA Kagiso PMI
• 09:30 SA ILB auction (R800mn)
• 09:30 SA Naamsa vehicle sales y/y
• 18:30 SA Dep. Gov. Mminele keynote speech published on SARB website
• 09:30 GB PMI manufacturing
• 12:58 US Markit PMI manufacturing (final)
• 13:10 US Fed’s Bullard speaks on monetary policy
• 14:00 US ISM manufacturing PMI
• 15:15 US Fed’s Kocherlakota speaks
Foreign exchange South Africa – Let one of our professional consultants at Currency Solutions assist you. To know more about how we can help you Contact Us
Want to know where the markets are? View our Live Currency Rates
ZAR outlook
USD/ZAR expected range: 9.9500 – 10.1500
After enjoying a period of relative stability and firm trading the ZAR was trading near a one month low this morning and breached the R10/$ level. The Rand is battling disappointing SA data and a greenback buoyed by upbeat US data released yesterday. The Rand was R10.0400/$ at 08:36 GMT, 0.2% firmer than its close in New York yesterday evening.
Local news
Trade data released yesterday revealed that the deficit narrowed by a smaller margin than the markets were expecting. The cumulative trade deficit for 2013 now stands at R126.37bn, compared to R83.6bn in 2012 meaning the ZAR will most likely be reliant on external funding for a while to come still.
International news
Strong US Chicago PMI data contributed to the good day for the USD. The PMI rose from 55.7 to 65.9 which surprised the markets as they were expecting a reading closer to 55.0. This, combined with the disappointing local data meant the Rand took strain and hit a low of 10.0695 – it’s weakest level since the beginning of October.
TODAYS KEY DATA POINTS (GMT):
• 09:00 SA Kagiso PMI
• 09:30 SA ILB auction (R800mn)
• 09:30 SA Naamsa vehicle sales y/y
• 18:30 SA Dep. Gov. Mminele keynote speech published on SARB website
• 09:30 GB PMI manufacturing
• 12:58 US Markit PMI manufacturing (final)
• 13:10 US Fed’s Bullard speaks on monetary policy
• 14:00 US ISM manufacturing PMI
• 15:15 US Fed’s Kocherlakota speaks
Foreign exchange South Africa – Let one of our professional consultants at Currency Solutions assist you. To know more about how we can help you Contact Us
Want to know where the markets are? View our Live Currency Rates
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