Trade report 18/12/2013
ZAR outlook
USD/ZAR expected range: 10.2800 – 10.4500
As the conclusion of the FOMC meeting draws nearer there has been some nervous trading in the markets causing the Rand and the majority of the EM currencies to slip against the USD. The Rand was down 0.26% this morning from its overnight close against the USD and at 06:57GMT was trading at R10.3570/USD.
Local news
The Rand is trading softer against the USD, with little local data to help prop it up while the markets are being dominated by Fed taper talk. That said however, the weakening momentum should the Fed decide to start tapering, should not be overly pronounced into the first half of next year as this has been the talk in the markets since May already.
International news
Investors will be keenly awaiting the results of the FOMC meeting due to be released later this evening in the US. There are two likely scenarios and the market participants remain heavily divided between the two. The first is that the Fed starts a modest degree of tapering from today and the second is the delaying of tapering but with strong indications as to when they will start the taper, most likely either Jan or March 2014.
TODAYS KEY DATA POINTS (GMT):
• 07:00 SA Leading indicator
• 09:00 DE IFO business climate
• 09:30 GB BoE releases MPC minutes
• 09:30 GB ILO unemployment rate
• 10:00 EZ Construction output wda y/y
• 13:30 US Housing starts
• 19:00 US FOMC rate decision
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Wednesday 18 December 2013
Tuesday 17 December 2013
Rand steady as FOMC meeting starts
Trade report 17/12/2013
ZAR outlook
USD/ZAR expected range: 10.2400 – 10.3600
The Rand has been trading relatively steady against the USD since Friday and even managed to touch on a two-week high. But the currency faces a tough week ahead with the start of the FOMC meeting today. The ZAR was trading around R10.2840/$ this morning, very close to yesterdays close in New York.
Local news
It has been a very quiet start to the week for the ZAR with the country enjoying a day off for Reconciliation Day yesterday. With very little local data due for release today the currency will be taking its direction from International events. The main event of the week is the much talked about FOMC meeting which starts today and could see some volatility caused for the Rand and other emerging market currencies.
International news
The main data for the day is offshore CPI data and it will be interesting to note if US data sustains its gains from last month as this data comes just at the start of the FOMC meeting. The FOMC meeting concludes tomorrow and will have investors eagerly waiting to hear whether or not we will see a start to tapering of the US bond buying stimulus which has been the main talk in the markets for weeks now.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA Bond auction
• 09:30 GB CPI y/y
• 10:00 EZ ZEW economic sentiment
• 10:00 DE ZEW sentiment
• 10:00 EZ CPI y/y (final)
• 13:30 US Current account balance (USD)
• 13:30 US CPI y/y
• 15:00 US NAHB Housing Market Index
• US FOMC Meeting begins (17-18 Dec)
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ZAR outlook
USD/ZAR expected range: 10.2400 – 10.3600
The Rand has been trading relatively steady against the USD since Friday and even managed to touch on a two-week high. But the currency faces a tough week ahead with the start of the FOMC meeting today. The ZAR was trading around R10.2840/$ this morning, very close to yesterdays close in New York.
Local news
It has been a very quiet start to the week for the ZAR with the country enjoying a day off for Reconciliation Day yesterday. With very little local data due for release today the currency will be taking its direction from International events. The main event of the week is the much talked about FOMC meeting which starts today and could see some volatility caused for the Rand and other emerging market currencies.
International news
The main data for the day is offshore CPI data and it will be interesting to note if US data sustains its gains from last month as this data comes just at the start of the FOMC meeting. The FOMC meeting concludes tomorrow and will have investors eagerly waiting to hear whether or not we will see a start to tapering of the US bond buying stimulus which has been the main talk in the markets for weeks now.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA Bond auction
• 09:30 GB CPI y/y
• 10:00 EZ ZEW economic sentiment
• 10:00 DE ZEW sentiment
• 10:00 EZ CPI y/y (final)
• 13:30 US Current account balance (USD)
• 13:30 US CPI y/y
• 15:00 US NAHB Housing Market Index
• US FOMC Meeting begins (17-18 Dec)
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Friday 13 December 2013
Rand struggling ahead of FOMC meeting
Trade report 13/12/2013
ZAR outlook
USD/ZAR expected range: 10.3400 – 10.4800
The Rand softened further against the USD yesterday and is likely to encounter more losses as talk increases of an imminent start to QE tapering by the Fed. The ZAR was at R10.4150/$ in early morning trade, 0.24% softer than its close in New York yesterday evening.
Local news
The ZAR finds itself in a vulnerable position as talk of a start to the FED taper as early as next week at its last meeting for the year mounts. The Rand is one of the riskier EM currencies, heavily reliant on foreign funding to plug its current account deficit, and with domestic interest rates at four-decade lows the currency doesn’t hold the high yield appeal that attracts investors.
International news
The USD is enjoying a period of gains after retail sales data and consumer confidence data came in stronger than expected. Jobless claims increased however, although this data tends to be volatile and the improved retail sales data will definitely add to the increasing speculation of a start to Fed tapering from next week. The GBP meanwhile made gains on the EUR after the British Chamber of Commerce announced that it believes the UK economy will expand at its fastest pace in 7 years in 2014.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA ILB auction (R800mn)
• 09:45 EZ ECB Coeure speaks
• 10:00 EZ Employment y/y
• 11:45 EZ ECB’s Constancio, Hansson speak
• 12:30 GB BoE’s Dale speaks
• 13:30 US PPI y/y
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ZAR outlook
USD/ZAR expected range: 10.3400 – 10.4800
The Rand softened further against the USD yesterday and is likely to encounter more losses as talk increases of an imminent start to QE tapering by the Fed. The ZAR was at R10.4150/$ in early morning trade, 0.24% softer than its close in New York yesterday evening.
Local news
The ZAR finds itself in a vulnerable position as talk of a start to the FED taper as early as next week at its last meeting for the year mounts. The Rand is one of the riskier EM currencies, heavily reliant on foreign funding to plug its current account deficit, and with domestic interest rates at four-decade lows the currency doesn’t hold the high yield appeal that attracts investors.
International news
The USD is enjoying a period of gains after retail sales data and consumer confidence data came in stronger than expected. Jobless claims increased however, although this data tends to be volatile and the improved retail sales data will definitely add to the increasing speculation of a start to Fed tapering from next week. The GBP meanwhile made gains on the EUR after the British Chamber of Commerce announced that it believes the UK economy will expand at its fastest pace in 7 years in 2014.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA ILB auction (R800mn)
• 09:45 EZ ECB Coeure speaks
• 10:00 EZ Employment y/y
• 11:45 EZ ECB’s Constancio, Hansson speak
• 12:30 GB BoE’s Dale speaks
• 13:30 US PPI y/y
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Thursday 12 December 2013
Rand softens ahead of local inflation data
Trade report 12/12/2013
ZAR outlook
USD/ZAR expected range: 10.3400 – 10.4800
After firming yesterday the ZAR has fallen to its weakest level this week as investors sell off risky assets ahead of the Fed meeting next week and the market awaits the local inflation data due for release today. The Rand was 0.2% weaker this morning at R10.4140/$.
Local news
Consumer inflation data is expected to slow to 5.3% y/y in November from 5.5% last month. This will give SARB some breathing room to leave interest rates unchanged as South African households are under pressure, especially due to fuel and administrative tariff hikes. This is not good news for the strength of the ZAR however, as such low interest rates leave the ZAR exposed.
International news
The Euro is slightly up as news came in that EU finance ministers are close to reaching a deal on the European Banking Union. This and the uncertainty over whether or not the Fed will start QE tapering at its meeting next week meant the USD dropped to a 6 week low against the EUR. US retails sales and jobless claims data are due for release today, which although not overly significant on their own, may or may not add further weight to the increasing speculation of a Fed taper starting next week.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA PPI y/y
• 09:00 EZ ECB publishes monthly report
• 10:00 EZ Industrial production (WDA) y/y
• 13:30 US Advance retail sales m/m
• 13:30 US Initial jobless claims
• 13:30 US Import price index y/y
• 15:00 US Business inventories m/m
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ZAR outlook
USD/ZAR expected range: 10.3400 – 10.4800
After firming yesterday the ZAR has fallen to its weakest level this week as investors sell off risky assets ahead of the Fed meeting next week and the market awaits the local inflation data due for release today. The Rand was 0.2% weaker this morning at R10.4140/$.
Local news
Consumer inflation data is expected to slow to 5.3% y/y in November from 5.5% last month. This will give SARB some breathing room to leave interest rates unchanged as South African households are under pressure, especially due to fuel and administrative tariff hikes. This is not good news for the strength of the ZAR however, as such low interest rates leave the ZAR exposed.
International news
The Euro is slightly up as news came in that EU finance ministers are close to reaching a deal on the European Banking Union. This and the uncertainty over whether or not the Fed will start QE tapering at its meeting next week meant the USD dropped to a 6 week low against the EUR. US retails sales and jobless claims data are due for release today, which although not overly significant on their own, may or may not add further weight to the increasing speculation of a Fed taper starting next week.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA PPI y/y
• 09:00 EZ ECB publishes monthly report
• 10:00 EZ Industrial production (WDA) y/y
• 13:30 US Advance retail sales m/m
• 13:30 US Initial jobless claims
• 13:30 US Import price index y/y
• 15:00 US Business inventories m/m
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Wednesday 11 December 2013
ZAR boosted by positive local data
Trade report 11/12/2013
ZAR outlook
USD/ZAR expected range: 10.2600 – 10.4100
Upbeat mining and manufacturing data released yesterday helped the ZAR strengthen to its strongest position in almost a week at R10.2725/$. This morning at 06:25GMT the Rand was at R10.3600/$ and trading in a narrow range with little scope for any major changes, although local data due for release today may help it firm should it come out stronger than expected.
Local news
Mining data and manufacturing data came out stronger than expected yesterday helping the Rand firm up slightly. Mining production increased by a significant 22% year on year in October while manufacturing data surprised the market by rising 1.5% from a 3.3% contraction previously. Q3 employment data also came in with a 0.2% y/y increase which made it a good day all round for local data releases.
International news
The Rand was the best performer yesterday of the emerging markets with its positive data releases helping boost the currency slightly. In other news US lawmakers have reached a budget deal overnight which lifts spending over the next two years by $63bn. This increase should avoid another government shut-down in January which increases the speculation of a start to Fed tapering at next week’s policy meeting.
TODAYS KEY DATA POINTS (GMT):
• 08:00 SA CPI y/y
• 11:00 SA Retail sales constant y/y
• 07:00 DE CPI y/y (final)
• 12:00 US MBA mortgage applications
• 19:00 US Monthly budget statement
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ZAR outlook
USD/ZAR expected range: 10.2600 – 10.4100
Upbeat mining and manufacturing data released yesterday helped the ZAR strengthen to its strongest position in almost a week at R10.2725/$. This morning at 06:25GMT the Rand was at R10.3600/$ and trading in a narrow range with little scope for any major changes, although local data due for release today may help it firm should it come out stronger than expected.
Local news
Mining data and manufacturing data came out stronger than expected yesterday helping the Rand firm up slightly. Mining production increased by a significant 22% year on year in October while manufacturing data surprised the market by rising 1.5% from a 3.3% contraction previously. Q3 employment data also came in with a 0.2% y/y increase which made it a good day all round for local data releases.
International news
The Rand was the best performer yesterday of the emerging markets with its positive data releases helping boost the currency slightly. In other news US lawmakers have reached a budget deal overnight which lifts spending over the next two years by $63bn. This increase should avoid another government shut-down in January which increases the speculation of a start to Fed tapering at next week’s policy meeting.
TODAYS KEY DATA POINTS (GMT):
• 08:00 SA CPI y/y
• 11:00 SA Retail sales constant y/y
• 07:00 DE CPI y/y (final)
• 12:00 US MBA mortgage applications
• 19:00 US Monthly budget statement
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Tuesday 10 December 2013
ZAR firmer ahead of mining and manufacturing release
Trade report 10/12/2013
ZAR outlook
USD/ZAR expected range: 10.3000 – 10.4500
The ZAR closed on Monday slightly weaker against the dollar but this morning was trading slightly firmer ahead of local mining and manufacturing data due for release today. The Rand was trading at R10.3700/$ at 06:32 GMT this morning, 0.2% firmer than its close yesterday in New York. Trading volumes on the USD-ZAR seem to be slowing down as well, as the end of the year approaches.
Local news
Local news focus at the moment is still very much on the passing of Nelson Mandela and his memorial currently taking place. Today sees the release of Q3 employment data, October mining data and manufacturing production data. Economists are hoping for stronger than anticipated data, although it is doubtful that this will help the Rand make a strong recovery as the markets are being dominated by talk of the Fed taper.
International news
After a day of relatively light trading yesterday and little in the way of data releases the Pound, Euro and USD were little changed. Various Fed members yesterday made comments suggesting that a small taper may be on the cards as early as next week at the FOMC’s last meeting of the year, although until this is made official, it is unlikely to cause too much volatility as this thought has been doing the rounds for some weeks already.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA Bond auction (R2023 – R900mn; R2030 – R550mn; R209 – R900mn)
• 09:30 SA Non-farm payrolls y/y
• 09:30 SA Mining production y/y
• 11:00 SA Manufacturing production n.s.a y/y
• 09:30 GB Industrial production y/y
• 15:00 US Wholesale inventories
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ZAR outlook
USD/ZAR expected range: 10.3000 – 10.4500
The ZAR closed on Monday slightly weaker against the dollar but this morning was trading slightly firmer ahead of local mining and manufacturing data due for release today. The Rand was trading at R10.3700/$ at 06:32 GMT this morning, 0.2% firmer than its close yesterday in New York. Trading volumes on the USD-ZAR seem to be slowing down as well, as the end of the year approaches.
Local news
Local news focus at the moment is still very much on the passing of Nelson Mandela and his memorial currently taking place. Today sees the release of Q3 employment data, October mining data and manufacturing production data. Economists are hoping for stronger than anticipated data, although it is doubtful that this will help the Rand make a strong recovery as the markets are being dominated by talk of the Fed taper.
International news
After a day of relatively light trading yesterday and little in the way of data releases the Pound, Euro and USD were little changed. Various Fed members yesterday made comments suggesting that a small taper may be on the cards as early as next week at the FOMC’s last meeting of the year, although until this is made official, it is unlikely to cause too much volatility as this thought has been doing the rounds for some weeks already.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA Bond auction (R2023 – R900mn; R2030 – R550mn; R209 – R900mn)
• 09:30 SA Non-farm payrolls y/y
• 09:30 SA Mining production y/y
• 11:00 SA Manufacturing production n.s.a y/y
• 09:30 GB Industrial production y/y
• 15:00 US Wholesale inventories
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Monday 9 December 2013
ZAR firms after near 5-year lows
Trade report 09/12/2013
ZAR outlook
USD/ZAR expected range: 10.2500 – 10.4000
Last week’s strong US data releases had the ZAR firmly on the backfoot as it dropped to 5 year lows of over R10.505/$. The Rand rallied in the last hour or two of Friday’s trade and closed at R10.3200. This morning the ZAR has been holding more or less steady but it faces a tough week ahead with more data releases and comments from numerous Fed members scheduled.
Local news
News over the week-end has been dominated by stories about Nelson Mandela’s passing and his coming funeral. The Rand has shown very little reaction to his passing and it is worth noting that there has been very little negative press around the issue and South Africa’s future. Investors will now be waiting for the next set of local data to be released this week which includes manufacturing and mining production for October, consumer and producer price inflation for November and retail sales data for October.
International news
Emerging market currencies all took strain on Friday when the US payrolls numbers came out better than anticipated and the fear of the Fed taper took hold. But within the hour there was a general EM rebound. The risks still remain for the EM currencies and we may see further volatility this week as various Fed members are due to speak, but for now the tapering may be priced in which reduces the threat of a run on the Rand.
TODAYS KEY DATA POINTS (GMT):
• 07:00 DE Trade balance (EUR)
• 08:15 EZ ECB’s Mersch speaks
• 09:30 EZ Sentix investor confidence index
• 11:00 DE Industrial production wda y/y
• 17:30 US Fed’s Lacker speaks
• 18:05 US Fed’s Bullard speaks
• 19:15 US Fed’s Fisher speaks
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ZAR outlook
USD/ZAR expected range: 10.2500 – 10.4000
Last week’s strong US data releases had the ZAR firmly on the backfoot as it dropped to 5 year lows of over R10.505/$. The Rand rallied in the last hour or two of Friday’s trade and closed at R10.3200. This morning the ZAR has been holding more or less steady but it faces a tough week ahead with more data releases and comments from numerous Fed members scheduled.
Local news
News over the week-end has been dominated by stories about Nelson Mandela’s passing and his coming funeral. The Rand has shown very little reaction to his passing and it is worth noting that there has been very little negative press around the issue and South Africa’s future. Investors will now be waiting for the next set of local data to be released this week which includes manufacturing and mining production for October, consumer and producer price inflation for November and retail sales data for October.
International news
Emerging market currencies all took strain on Friday when the US payrolls numbers came out better than anticipated and the fear of the Fed taper took hold. But within the hour there was a general EM rebound. The risks still remain for the EM currencies and we may see further volatility this week as various Fed members are due to speak, but for now the tapering may be priced in which reduces the threat of a run on the Rand.
TODAYS KEY DATA POINTS (GMT):
• 07:00 DE Trade balance (EUR)
• 08:15 EZ ECB’s Mersch speaks
• 09:30 EZ Sentix investor confidence index
• 11:00 DE Industrial production wda y/y
• 17:30 US Fed’s Lacker speaks
• 18:05 US Fed’s Bullard speaks
• 19:15 US Fed’s Fisher speaks
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Friday 6 December 2013
Rand on the backfoot ahead of US nonfarm payrolls release
Trade report 06/12/2013
ZAR outlook
USD/ZAR expected range: 10.3500 – 10.5100
The Rand broke through R10.50/$ yesterday and fell to its lowest level in nearly 5 years as investors started selling off risky assets amid fears of an earlier than expected start to the Feds QE taper. The Rand firmed slightly this morning and at 08:16 this morning was at R10.4400/$ and was showing no immediate reaction to the sad news of the death of former president Nelson Mandela.
Local news
The ZAR continues to underperform compared to its EM peers mainly due to its twin deficits and negative investor sentiment. The JSE will be paused for 5min today from 11am as a sign of respect for former president Nelson Mandela who sadly passed away last night. The markets have shown little reaction to this news, as it has been expected for some time, and Mr Mandela had not been active in the political scene for almost a decade.
International news
News that the ECB did not cut interest rates gave the Euro a boost yesterday while the Pound retreated as the BoE left interest rates unchanged. All eyes today will be on the US non-farm payrolls data which should confirm the recent string of positive data and may give investors a better idea of the timing of the much speculated Fed taper.
TODAYS KEY DATA POINTS (GMT):
• 06:00 SA Net reserves (USD)
• 09:30 GB BoE/GfK inflation (next 12 months)
• 11:00 DE Factory orders y/y
• 13:30 US Nonfarm payrolls
• 13:30 US Unemployment rate
• 13:30 US PCE core y/y
• 14:55 US Michigan consumer confidence (preliminary)
• 20:00 US Consumer credit (USD)
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ZAR outlook
USD/ZAR expected range: 10.3500 – 10.5100
The Rand broke through R10.50/$ yesterday and fell to its lowest level in nearly 5 years as investors started selling off risky assets amid fears of an earlier than expected start to the Feds QE taper. The Rand firmed slightly this morning and at 08:16 this morning was at R10.4400/$ and was showing no immediate reaction to the sad news of the death of former president Nelson Mandela.
Local news
The ZAR continues to underperform compared to its EM peers mainly due to its twin deficits and negative investor sentiment. The JSE will be paused for 5min today from 11am as a sign of respect for former president Nelson Mandela who sadly passed away last night. The markets have shown little reaction to this news, as it has been expected for some time, and Mr Mandela had not been active in the political scene for almost a decade.
International news
News that the ECB did not cut interest rates gave the Euro a boost yesterday while the Pound retreated as the BoE left interest rates unchanged. All eyes today will be on the US non-farm payrolls data which should confirm the recent string of positive data and may give investors a better idea of the timing of the much speculated Fed taper.
TODAYS KEY DATA POINTS (GMT):
• 06:00 SA Net reserves (USD)
• 09:30 GB BoE/GfK inflation (next 12 months)
• 11:00 DE Factory orders y/y
• 13:30 US Nonfarm payrolls
• 13:30 US Unemployment rate
• 13:30 US PCE core y/y
• 14:55 US Michigan consumer confidence (preliminary)
• 20:00 US Consumer credit (USD)
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Thursday 5 December 2013
Rand under pressure as USD enjoys recovery
Trade report 05/12/2013
ZAR outlook
USD/ZAR expected range: 10.3500 – 10.5500
The Rand has weakened significantly against the USD as talks increase around the earlier timing of the Fed taper which has investors starting to sell off riskier assets. The Rand is skirting around a 3 week low and at 06:44GMT was at R10.4200/$, very close to its Wednesday close in New York of R10.4474/$
Local news
The large c/a and budget deficit remains a major concern for the ZAR as it leaves the Rand very dependent on international investment. Recently some Fed members have been talking about an earlier than expected start to the taper which leaves the Rand very exposed and one of the worst emerging market performers.
International news
The GBP dropped slightly yesterday after the PMI data released came in weaker than the previous month of October, while the Euro recovered some ground after EZ PMI data beat expectations. The USD is enjoying a period of recovery as recent data releases have indicated a healthier economy, but investors will still be keenly awaiting the important data release of the non-farm payrolls which is due out tomorrow. This is also the last piece of key data due for release before the next FOMC meeting at the end of December.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA SACCI business confidence
• 12:00 GB BoE rate decision
• 12:00 GB BoE asset purchase target
• 12:45 EZ ECB refi rate announcement
• 13:30 EZ ECB Pres. Draghi holds press conference
• 13:30 US Initial jobless claims
• 13:30 US GDP q/q annualized (second reading)
• 13:30 US Personal consumption (second reading)
• 15:00 US Factory orders
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ZAR outlook
USD/ZAR expected range: 10.3500 – 10.5500
The Rand has weakened significantly against the USD as talks increase around the earlier timing of the Fed taper which has investors starting to sell off riskier assets. The Rand is skirting around a 3 week low and at 06:44GMT was at R10.4200/$, very close to its Wednesday close in New York of R10.4474/$
Local news
The large c/a and budget deficit remains a major concern for the ZAR as it leaves the Rand very dependent on international investment. Recently some Fed members have been talking about an earlier than expected start to the taper which leaves the Rand very exposed and one of the worst emerging market performers.
International news
The GBP dropped slightly yesterday after the PMI data released came in weaker than the previous month of October, while the Euro recovered some ground after EZ PMI data beat expectations. The USD is enjoying a period of recovery as recent data releases have indicated a healthier economy, but investors will still be keenly awaiting the important data release of the non-farm payrolls which is due out tomorrow. This is also the last piece of key data due for release before the next FOMC meeting at the end of December.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA SACCI business confidence
• 12:00 GB BoE rate decision
• 12:00 GB BoE asset purchase target
• 12:45 EZ ECB refi rate announcement
• 13:30 EZ ECB Pres. Draghi holds press conference
• 13:30 US Initial jobless claims
• 13:30 US GDP q/q annualized (second reading)
• 13:30 US Personal consumption (second reading)
• 15:00 US Factory orders
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Wednesday 4 December 2013
Rand struggling after c/a news
Trade report 04/12/2013
ZAR outlook
USD/ZAR expected range: 10.2900 – 10.4400
Investor confidence in the ZAR was badly shaken yesterday as current account data revealed a deficit of over R230bn and failed to sustain growth from Q3 to Q4. The Rand was down at R10.3780/$ at 06:14 GMT, already 0.5% weaker than its close in New York yesterday. Added to this increased talk over the timing of the Fed taper has the ZAR on the backfoot.
Local news
“The current account is a real concern. At 6.8 percent of GDP in 3Q13, the deficit is the worst since the crisis”, an analyst wrote in a note. South Africa now has to deal with a c/a deficit of R230bn which is the largest on record. This increases the reliance on foreign-capital to plug the gap, but with traders speculating over the timing of the Fed taper the Rand is left very exposed and remains one of the worst EM performers.
International news
The Pound and the Euro have enjoyed recent gains after positive GB construction data and improved unemployment numbers out of Spain were released. Investors will be keenly awaiting the next set of data out of the US, including GDP, unemployment and trade balance data. This data should give a better idea of the state of the US economy in the run-up to the next FOMC meeting in two weeks’ time.
TODAYS KEY DATA POINTS (GMT):
• 07:15 SA HSBC/Markit Composite PMI
• 09:00 EZ PMI services (final)
• 10:00 EZ GDP sa q/q (second reading)
• 10:00 EZ Retail sales y/y
• 13:15 US ADP employment change
• 13:30 US Trade balance (USD)
• 15:00 US ISM non-manufacturing composite
• 15:00 US New home sales
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ZAR outlook
USD/ZAR expected range: 10.2900 – 10.4400
Investor confidence in the ZAR was badly shaken yesterday as current account data revealed a deficit of over R230bn and failed to sustain growth from Q3 to Q4. The Rand was down at R10.3780/$ at 06:14 GMT, already 0.5% weaker than its close in New York yesterday. Added to this increased talk over the timing of the Fed taper has the ZAR on the backfoot.
Local news
“The current account is a real concern. At 6.8 percent of GDP in 3Q13, the deficit is the worst since the crisis”, an analyst wrote in a note. South Africa now has to deal with a c/a deficit of R230bn which is the largest on record. This increases the reliance on foreign-capital to plug the gap, but with traders speculating over the timing of the Fed taper the Rand is left very exposed and remains one of the worst EM performers.
International news
The Pound and the Euro have enjoyed recent gains after positive GB construction data and improved unemployment numbers out of Spain were released. Investors will be keenly awaiting the next set of data out of the US, including GDP, unemployment and trade balance data. This data should give a better idea of the state of the US economy in the run-up to the next FOMC meeting in two weeks’ time.
TODAYS KEY DATA POINTS (GMT):
• 07:15 SA HSBC/Markit Composite PMI
• 09:00 EZ PMI services (final)
• 10:00 EZ GDP sa q/q (second reading)
• 10:00 EZ Retail sales y/y
• 13:15 US ADP employment change
• 13:30 US Trade balance (USD)
• 15:00 US ISM non-manufacturing composite
• 15:00 US New home sales
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Tuesday 3 December 2013
Rand under fire as local data disappoints
Trade report 03/12/2013
ZAR outlook
USD/ZAR expected range: 10.2200 – 10.3700
The ZAR is under pressure today as fears of an early taper mount due to strong data out of the US and the disappointing news that SA’s current account is the largest it has been in 5 years. The Rand was at 10.2940/$ at 06:19GMT this morning, already 0.2% off its close in New York yesterday and looking to weaken even further during the course of the day.
Local news
Strikes and increased government spending have taken its toll on the economy as the Q3 current account deficit is now the biggest in 5 years. The market had expected the figure to come in at around 6.0% from the last quarter of 6.5%, but instead the figure expanded to 6.8%, highlighting the strain the economy is under and leaving the Rand exposed.
International news
Stronger than expected PMI data was released out of China, the US, the UK and the Eurozone yesterday. It is concerning that analysts also expect strong US nonfarm payrolls data to be released later in the week which would confirm that the US economy is doing well and increase speculation of the Fed starting QE tapering in the near future. This increases pressure on an already vulnerable ZAR, as South Africa is heavily reliant on foreign funding.
TODAYS KEY DATA POINTS (GMT):
• 08:00 SA Current account balance
• 09:30 SA Bond auction (R2030 – R550mn; R214 – R900mn; R2048 – R900mn)
• 09:30 GB PMI construction
• 10:00 EZ PPI y/y
• 14:45 US ISM New York
• 15:00 US IBD/TIPP economic optimism
• 18:00 EZ ECB’s Nowotny 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: 10.2200 – 10.3700
The ZAR is under pressure today as fears of an early taper mount due to strong data out of the US and the disappointing news that SA’s current account is the largest it has been in 5 years. The Rand was at 10.2940/$ at 06:19GMT this morning, already 0.2% off its close in New York yesterday and looking to weaken even further during the course of the day.
Local news
Strikes and increased government spending have taken its toll on the economy as the Q3 current account deficit is now the biggest in 5 years. The market had expected the figure to come in at around 6.0% from the last quarter of 6.5%, but instead the figure expanded to 6.8%, highlighting the strain the economy is under and leaving the Rand exposed.
International news
Stronger than expected PMI data was released out of China, the US, the UK and the Eurozone yesterday. It is concerning that analysts also expect strong US nonfarm payrolls data to be released later in the week which would confirm that the US economy is doing well and increase speculation of the Fed starting QE tapering in the near future. This increases pressure on an already vulnerable ZAR, as South Africa is heavily reliant on foreign funding.
TODAYS KEY DATA POINTS (GMT):
• 08:00 SA Current account balance
• 09:30 SA Bond auction (R2030 – R550mn; R214 – R900mn; R2048 – R900mn)
• 09:30 GB PMI construction
• 10:00 EZ PPI y/y
• 14:45 US ISM New York
• 15:00 US IBD/TIPP economic optimism
• 18:00 EZ ECB’s Nowotny 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
Monday 2 December 2013
Rand looking to take direction from local and international data
Trade report 02/12/2013
ZAR outlook
USD/ZAR expected range: 10.1200 – 10.2700
Encouraging PMI data out of China, South Africa’s leading trade partner, has helped the Rand stay steady over the week-end after a volatile week. The Rand was trading at R10.1650/$ at 08:40GMT, 0.26% firmer than its close on Friday. There is data due for release today both locally and internationally which the ZAR will take its direction from.
Local news
Investors will be watching for local data due for release this week. PMI manufacturing and Naamsa vehicle sales data is set to be released today and while analysts expect the data to show improvement, the trend is likely to remain weak. Tomorrows Q3 current account data will be of particular interest as investors will be keen to see how the new methodology affects the current account figure.
International news
PMI data is due out of the major economies today which will shed more light on global growth expectations. While PMI results out of China were stronger than expected, the data still pointed to an economy that is growing only gradually. With interest rate decisions scheduled this week from the BoE and the ECB, as well as nonfarm-payrolls data due out from the US later this week, the markets seem to be starting out the week on a cautious footing.
TODAYS KEY DATA POINTS (GMT):
• 09:00 SA Kagiso PMI
• 09:00 SA Naamsa vehicle sales y/y
• 08:30 EZ ECB’s Constancio, Honoham speak
• 08:55 DE PMI manufacturing (final)
• 09:00 EZ PMI manufacturing (final)
• 09:30 GB PMI manufacturing
• 13:30 US Fed’s Bernanke speaks
• 13:58 US Markit PMI manufacturing (final)
• 15:00 US ISM manufacturing
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: 10.1200 – 10.2700
Encouraging PMI data out of China, South Africa’s leading trade partner, has helped the Rand stay steady over the week-end after a volatile week. The Rand was trading at R10.1650/$ at 08:40GMT, 0.26% firmer than its close on Friday. There is data due for release today both locally and internationally which the ZAR will take its direction from.
Local news
Investors will be watching for local data due for release this week. PMI manufacturing and Naamsa vehicle sales data is set to be released today and while analysts expect the data to show improvement, the trend is likely to remain weak. Tomorrows Q3 current account data will be of particular interest as investors will be keen to see how the new methodology affects the current account figure.
International news
PMI data is due out of the major economies today which will shed more light on global growth expectations. While PMI results out of China were stronger than expected, the data still pointed to an economy that is growing only gradually. With interest rate decisions scheduled this week from the BoE and the ECB, as well as nonfarm-payrolls data due out from the US later this week, the markets seem to be starting out the week on a cautious footing.
TODAYS KEY DATA POINTS (GMT):
• 09:00 SA Kagiso PMI
• 09:00 SA Naamsa vehicle sales y/y
• 08:30 EZ ECB’s Constancio, Honoham speak
• 08:55 DE PMI manufacturing (final)
• 09:00 EZ PMI manufacturing (final)
• 09:30 GB PMI manufacturing
• 13:30 US Fed’s Bernanke speaks
• 13:58 US Markit PMI manufacturing (final)
• 15:00 US ISM manufacturing
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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