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/$, very close to its close in New York on Friday evening.
Local news
In local news workers from the National Union of Mineworkers have gone on strike over wages at mid-tier producer Northam Platinum. There is a fear of further strikes starting at Anglo American Platinum, Impala Platinum and Lonmin by the Association of Mineworkers and Construction Union. This news adds to negative investor sentiment and increases pressure on an already vulnerable Rand.
International news
Fed QE tapering expectations are one of the main topics in the markets at the moment with the general feeling that it won’t begin before March 2013. With this in mind, the week ahead will be a significant one with ECB and BoE policy meetings scheduled as well as numerous Fed officials due to speak and US Q3 GDP data due for release.
TODAYS KEY DATA POINTS (GMT):
• 09:00 EZ PMI Manufacturing (final)
• 09:30 EZ Sentix investor confidence
• 09:30 GB PMI construction
• 11:30 EZ ECB’s Asmussen speaks
• 14:45 US ISM New York
• 15:00 US Factory orders y/y
• 16:20 US Fed’s Powell speaks
• 21:00 US Fed’s Rosengren speaks
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Monday, 4 November 2013
Friday, 1 November 2013
Rand on the backfoot after disappointing trade release
Trade report 01/11/2013
ZAR outlook
USD/ZAR expected range: 9.9500 – 10.1500
After enjoying a period of relative stability and firm trading the ZAR was trading near a one month low this morning and breached the R10/$ 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
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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
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Thursday, 31 October 2013
Global appetite dips on FOMC announcement
Trade report 31/10/2013
ZAR outlook
USD/ZAR expected range: 9.8500 – 9.9900
The ZAR traded softer against the USD on Thursday after the FOMC announcement yesterday as global appetite dipped. The ZAR was at R9.9420/$ at 09:42 GMT this morning but could come under more pressure today with many US and SA data releases scheduled, including trade data for September and producer inflation data.
Local news
Interesting to note is that the ZAR ended the day yesterday as the 2nd worst performing EM currency, behind only the IDR. This highlights the fact that the ZAR struggles to capitalise on periods of lower USD resilience. This is probably mainly due to SA’s large twin deficits, the threat of a ratings downgrade and negative investor sentiment due to recent labour unrest.
International news
The Fed announced yesterday that it plans to continue its $85 billion per month bond buying programme although comments that this is putting a strain on the economy suggest it may start tapering sooner than previously expected, although this is not the general market consensus.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA PPI y/y
• 10:00 SA Switch auction (R500mn of R201 to R186)
• 12:00 SA Trade balance
• 12:30 US Initial jobless claims
• 13:45 US Chicago PMI
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ZAR outlook
USD/ZAR expected range: 9.8500 – 9.9900
The ZAR traded softer against the USD on Thursday after the FOMC announcement yesterday as global appetite dipped. The ZAR was at R9.9420/$ at 09:42 GMT this morning but could come under more pressure today with many US and SA data releases scheduled, including trade data for September and producer inflation data.
Local news
Interesting to note is that the ZAR ended the day yesterday as the 2nd worst performing EM currency, behind only the IDR. This highlights the fact that the ZAR struggles to capitalise on periods of lower USD resilience. This is probably mainly due to SA’s large twin deficits, the threat of a ratings downgrade and negative investor sentiment due to recent labour unrest.
International news
The Fed announced yesterday that it plans to continue its $85 billion per month bond buying programme although comments that this is putting a strain on the economy suggest it may start tapering sooner than previously expected, although this is not the general market consensus.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA PPI y/y
• 10:00 SA Switch auction (R500mn of R201 to R186)
• 12:00 SA Trade balance
• 12:30 US Initial jobless claims
• 13:45 US Chicago PMI
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Wednesday, 30 October 2013
Rand steady as investors await FOMC result
Trade report 30/10/2013
ZAR outlook
USD/ZAR expected range: 9.8100 – 9.9700
After trading slightly weaker against the USD yesterday, the ZAR has steadied this morning and is back to trading at mid-October levels. The Rand was trading at R9.8825/$ at 08:37 this morning and investors expect it to remain trading in a narrow range ahead of the FOMC announcement later on today.
Local news
In local news the SARB released its Financial Stability Review yesterday and has warned of a risk to the ratings outlook as a result of the on-going strike action and a slowing economy. Investors are also weary of the negative sentiment caused by local labour issues in the mining sector, where the Association of Mineworkers and Construction Union is threatening a call a strike at Impala Platinum.
International news
In a key US announcement today the FOMC will release its rate decision. “The market expects the Fed to start QE tapering only in March next year, but if the Fed policy statement proves to be more hawkish, we expect the Rand together with other risky assets to weaken and vice versa”, Absa Capital analysts said in a note this morning.
TODAYS KEY DATA POINTS (GMT):
• 12:00 SA South African budget (ZAR)
• 11:00 US MBA mortgage applications
• 12:15 US ADP employment change
• 12:30 US CPI y/y
• 18:00 US FOMC rate decision
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ZAR outlook
USD/ZAR expected range: 9.8100 – 9.9700
After trading slightly weaker against the USD yesterday, the ZAR has steadied this morning and is back to trading at mid-October levels. The Rand was trading at R9.8825/$ at 08:37 this morning and investors expect it to remain trading in a narrow range ahead of the FOMC announcement later on today.
Local news
In local news the SARB released its Financial Stability Review yesterday and has warned of a risk to the ratings outlook as a result of the on-going strike action and a slowing economy. Investors are also weary of the negative sentiment caused by local labour issues in the mining sector, where the Association of Mineworkers and Construction Union is threatening a call a strike at Impala Platinum.
International news
In a key US announcement today the FOMC will release its rate decision. “The market expects the Fed to start QE tapering only in March next year, but if the Fed policy statement proves to be more hawkish, we expect the Rand together with other risky assets to weaken and vice versa”, Absa Capital analysts said in a note this morning.
TODAYS KEY DATA POINTS (GMT):
• 12:00 SA South African budget (ZAR)
• 11:00 US MBA mortgage applications
• 12:15 US ADP employment change
• 12:30 US CPI y/y
• 18:00 US FOMC rate decision
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Tuesday, 29 October 2013
Rand softens ahead of FOMC meeting
Trade report 29/10/2013
ZAR outlook
USD/ZAR expected range: 9.7900 – 9.9300
The Rand weakened slightly against the dollar overnight as investors are thought to be waiting for results on local data and the outcome of the FOMC meeting tomorrow. The ZAR was 0.34% down this morning, from its close in New York yesterday, at R9.8561/$ at 09:27 GMT.
Local news
Local data released today showed that South Africa’s credit growth slowed to 7.55% y/y in September while money supply increased to 7.03%. A key figure that investors will be interested in and due for release today is the unemployment rate number. News which is a threat to investor sentiment is that SAMCU have announced its members have voted to strike at Impala Platinum, although employers are hopeful that a stoppage can be averted.
International news
There are a number of US data releases scheduled for today, although cautious trading is expected to continue until after tomorrows FOMC meeting where investors will be looking for clues as to when QE tapering could begin.
TODAYS KEY DATA POINTS (GMT):
• 06:00 SA M3 money supply y/y
• 06:00 SA Private sector credit y/y
• 09:30 SA Bond auction (R2023-900mn; R2031-550mn; R2037-900mn)
• 09:30 SA Unemployment rate
• 17:00 SA SARB releases Gov. Marcus’ overnight remarks
• 12:30 US PPI y/y
• 12:30 US Advance Retail sales
• 13: 00 US S&P/Case-Shiller house price composite-20 y/y
• 14:00 US Business inventories
• 14:00 US Consumer confidence
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ZAR outlook
USD/ZAR expected range: 9.7900 – 9.9300
The Rand weakened slightly against the dollar overnight as investors are thought to be waiting for results on local data and the outcome of the FOMC meeting tomorrow. The ZAR was 0.34% down this morning, from its close in New York yesterday, at R9.8561/$ at 09:27 GMT.
Local news
Local data released today showed that South Africa’s credit growth slowed to 7.55% y/y in September while money supply increased to 7.03%. A key figure that investors will be interested in and due for release today is the unemployment rate number. News which is a threat to investor sentiment is that SAMCU have announced its members have voted to strike at Impala Platinum, although employers are hopeful that a stoppage can be averted.
International news
There are a number of US data releases scheduled for today, although cautious trading is expected to continue until after tomorrows FOMC meeting where investors will be looking for clues as to when QE tapering could begin.
TODAYS KEY DATA POINTS (GMT):
• 06:00 SA M3 money supply y/y
• 06:00 SA Private sector credit y/y
• 09:30 SA Bond auction (R2023-900mn; R2031-550mn; R2037-900mn)
• 09:30 SA Unemployment rate
• 17:00 SA SARB releases Gov. Marcus’ overnight remarks
• 12:30 US PPI y/y
• 12:30 US Advance Retail sales
• 13: 00 US S&P/Case-Shiller house price composite-20 y/y
• 14:00 US Business inventories
• 14:00 US Consumer confidence
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Monday, 28 October 2013
Rand steady against weaker USD
Trade report 28/10/2013
ZAR outlook
USD/ZAR expected range: 9.7400 – 9.8600
The Rand continues to trade steadily against the USD ahead of a busy week with many data releases scheduled. The recent unimpressive US non-farm payrolls data adds to the theory that the US will delay QE tapering which is good news for the ZAR. The Rand was at R9.8200/$ at 08:45 this morning, largely unchanged from its close in New York on Friday.
Local news
The recent steady trading of the ZAR vs. the USD is widely thought to be more attributed to a USD on the backfoot as opposed to a strong Rand. It is a busy week locally with many data releases and investors will be keeping a close eye on results of private sector growth, vehicle sales and PMI data.
International news
There are some important US data releases scheduled this week including ADP employment, jobless claims and the ISM manufacturing PMI. The Fed is also scheduled to meet on Wednesday which is always a big event, although it is highly unlikely they will make changes to the current QE policy in place. The more likely scenario is one of a pricing for tapering to begin in 2014 which will benefit emerging markets.
TODAYS KEY DATA POINTS (GMT):
• 13:15 US Industrial production
• 14:00 US Pending home sales y/y
• 14:30 US Dallas Fed manufacturing activity
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ZAR outlook
USD/ZAR expected range: 9.7400 – 9.8600
The Rand continues to trade steadily against the USD ahead of a busy week with many data releases scheduled. The recent unimpressive US non-farm payrolls data adds to the theory that the US will delay QE tapering which is good news for the ZAR. The Rand was at R9.8200/$ at 08:45 this morning, largely unchanged from its close in New York on Friday.
Local news
The recent steady trading of the ZAR vs. the USD is widely thought to be more attributed to a USD on the backfoot as opposed to a strong Rand. It is a busy week locally with many data releases and investors will be keeping a close eye on results of private sector growth, vehicle sales and PMI data.
International news
There are some important US data releases scheduled this week including ADP employment, jobless claims and the ISM manufacturing PMI. The Fed is also scheduled to meet on Wednesday which is always a big event, although it is highly unlikely they will make changes to the current QE policy in place. The more likely scenario is one of a pricing for tapering to begin in 2014 which will benefit emerging markets.
TODAYS KEY DATA POINTS (GMT):
• 13:15 US Industrial production
• 14:00 US Pending home sales y/y
• 14:30 US Dallas Fed manufacturing activity
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
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Friday, 25 October 2013
ZAR under pressure due to mining strike fears
Trade report 25/10/2013
ZAR outlook
USD/ZAR expected range: 9.7200 – 9.8200
General feeling in the markets is that the FED will delay QE tapering and this is helping the ZAR which firmed against the USD yesterday after the jitters over the mini-budget calmed down. The Rand was 0.3% up on the USD from Wednesdays close at R9.97725/$ although today talks of mining strikes are weighing on the local currency.
Local news
The ZAR had a brief boost after the release of the mini-budget but is now under pressure due to fears of another bout of mining strikes. AMCU may go on strike after wage talks have failed to reach an agreement. The next local data release will be on Tuesday when unemployment figures and private sector borrowing figures will be released.
International news
Emerging markets are currently benefitting from the general feeling by investors that the US Federal Reserve Bank will delay QE tapering. This is helping the ZAR although of the EM’s SA remains one of the worst performing currencies, most likely due to its high budget and current account deficit.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA ILB auction (R800mn)
• 08:30 GB GDP y/y (advance)
• 12:30 US Durable goods orders
• 13:55 US Michigan consumer confidence
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ZAR outlook
USD/ZAR expected range: 9.7200 – 9.8200
General feeling in the markets is that the FED will delay QE tapering and this is helping the ZAR which firmed against the USD yesterday after the jitters over the mini-budget calmed down. The Rand was 0.3% up on the USD from Wednesdays close at R9.97725/$ although today talks of mining strikes are weighing on the local currency.
Local news
The ZAR had a brief boost after the release of the mini-budget but is now under pressure due to fears of another bout of mining strikes. AMCU may go on strike after wage talks have failed to reach an agreement. The next local data release will be on Tuesday when unemployment figures and private sector borrowing figures will be released.
International news
Emerging markets are currently benefitting from the general feeling by investors that the US Federal Reserve Bank will delay QE tapering. This is helping the ZAR although of the EM’s SA remains one of the worst performing currencies, most likely due to its high budget and current account deficit.
TODAYS KEY DATA POINTS (GMT):
• 09:30 SA ILB auction (R800mn)
• 08:30 GB GDP y/y (advance)
• 12:30 US Durable goods orders
• 13:55 US Michigan consumer confidence
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
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