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)
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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