• SA cities need foreigners

    We need to protect our cities' cosmopolitan nature, says Mzwandile Jacks.

  • Am I a racist?

    Does hating government's arrogance, nepotism and greed make me a bigot, asks Anton Ressel.

  • Recipe for disaster

    Malema's flames of frustration are fuelling white extremism, says Leopold Scholtz.

Loading...
See More

Rand cautiously firm before ECB

Aug 02 2012 09:32 Reuters

Related Articles

Importers sell rand at lower R8 level

Rand steadies after rally, bonds fall

Rand holds firm on eurozone euphoria

Rand bolstered by stimulus hopes

Rand on the back foot against dollar

Rand tests R8.3 support level

 

Johannesburg - The South African rand firmed against the dollar on Thursday on hopes the European Central Bank would announce further monetary stimulus to support ailing eurozone economies at a policy meeting later in the session.

However, investors were expected to tread carefully and not take big positions ahead of the meeting.

The rand was up 0.26% to the dollar at R8.3280 by 06:32 GMT, compared to its previous R8.3496 close in New York on Wednesday. It shot through the R8.30 support barrier after the US Federal Reserve soured investor sentiment by not announcing monetary easing on Wednesday.

“Globally, the focus is now on the ECB, with markets pricing in some easing action, but there is the potential for disappointment. So we expect players to remain cautious ahead of the meeting,” said Christopher Shiells of Informa Global Markets.

If the ECB does not deliver as expected, the rand is likely to tumble to last week’s R8.50 levels. A positive outcome could take the rand back to R8.15 and R8.11 resistance on the prospect of cheap money flooding emerging markets.

Government bonds were weaker especially in the longer end in anticipation of a switching auction where Treasury will swap R2.6bn of paper maturing in two years for the 2026 issue.

Yields rose 4.5 basis points on the 2026 bond to 7.395 as more paper was likely to go into that part of the yield curve. The 2015 yield climbed 3.5 basis points to 5.555%. This will be the first switch auction since June 28.

July vehicle sales data is due at 09:00 GMT and may deliver some positive news to the market after recent numbers raised worries about consumer spending.


*Follow Fin24 on Twitter, Facebook and Google+.

 

NEXT ON FIN24X

 
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Add your comment
Comment 0 characters remaining
 

Company Snapshot

Brought to you by BizNews

More from BizNews

We're talking about:

SMALL BUSINESS

Johannesburg has been selected to host the Global Entrepreneurship Congress in 2017. "[The congress] will ensure that small business development remains firmly on the national agenda and the radar screen of all stakeholders, the Small Business Development minister said.
 
 

Must see! The most luxurious dog house!

This dog house comes with a treadmill and hot tub, you have to see it!

 
 

Luxury living

WIN!
Ridiculous demands people with too much money make
8 of the priciest places to dock your yacht
Habits of the world’s richest people

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

Government’s call for the private sector to add power to the grid is:

Previous results · Suggest a vote

Loading...