Johannesburg – The rand continued its slide against the dollar on Wednesday morning‚ as a result of negative sentiment primarily driven by the decision of Anglo Platinum [JSE:AMS] to suspend some of its operations.
Kuziva Muganiwa‚ a global markets analyst from Vunani Capital‚ said the rand could weaken to R8.90/$ within the day.
“We’re still seeing some effect of the downgrade. This‚ in combination with profit taking on equities markets‚ a lack of fresh good news locally and Amplats plans to scale down their operations have all negatively impacted on the rand‚” he said.
At 11:25‚ the rand was bid at R8.8614/$ from R8.8048/$ at Tuesday’s close. The local currency was bid at R11.7620/€ from its previous close of R11.7112/€ and at R14.1899 against sterling from R14.1474 before.
The euro was bid at $1.3275 from Tuesday’s close of $1.3309.
“Internationally the euro has weakened‚ and if you combine this with the lack of fresh good news locally‚ the result is the rand taking a beating. Negative perceptions are still having an effect.
“Moving forward‚ should we experience any real resolution to the US debt crisis‚ global investors are going to prefer the safe haven status of the dollar and this will put even more pressure the rand‚” said Muganiwa.
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