Trade report 04/03/2014
ZAR outlook
USD/ZAR expected range: 10.7300 – 10.8800
The Rand dipped yesterday after tensions in the Ukraine caused a bout of panic in the markets. But the local currency has regained some of its losses today as Russia orders troops to return to base, raising the hopes of peace in the area. The ZAR was trading at R10.8300/USD at 07.10GMT this morning, slightly stronger than its close in New York yesterday of R10.9090.
Local news
Yesterday’s Kagiso PMI reading was stronger than expected at 51.7. Despite this, the reading is not reflecting a growth rate strong enough to warrant much attention or help make any significant gains for the ZAR, especially as international sentiment seems to be driving the market at the moment with little local data due for release today.
International news
President Putin has ordered troops that were busy with military exercises in central and western Russia, to return to base. This pulling out of troops has been interpreted as a move towards peace which is risk positive for investors, and as such good news for emerging markets and the local currency. Today also sees the release of US PMI data and the Feds Lacker will speak on the economy, which may give clues as to future taper decisions.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA Bond auction
• 09:30 GB PMI construction
• 14:45 US ISM New York PMI
• 15:00 US IBD/TIPP economic optimism
• 21:15 US Fed’s Lacker speaks on economy
• US President Obama sends 2015 fiscal budget to Congress
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