Johannesburg – The rand was marginally firmer shortly before midday on Monday‚ buoyed by a relatively firm euro.
Although the euro was slightly lower on the day‚ it soared 1.5% against the dollar on Friday following the poor US jobs figures.
At 11:35‚ the rand was bid at R8.1763 to the dollar from R8.1881 at Friday’s close. It was bid at R10.4439 to the euro from its previous close of R10.4752 and at R13.0762 against sterling from R13.1038 before.
The euro was bid at $1.2781 from $1.2796 at Friday’s close.
“The rand has traded consistently within an 8.05-8.55 range against the US dollar for more than three months‚ but now that northern hemisphere participants are back to their desks in earnest after the summer holidays‚ we believe there could be more decisive rand price action‚” Absa Capital said in its morning report.
“We still favour a downside break (i.e. rand bullish) of this range over the coming months‚ but much will depend on the outcome of this month’s deluge of critical events and the outcome of the high-frequency data flows‚” it said.
“This week is laced with important international developments‚” Absa Capital said.
Dow Jones Newswires reported that the euro nudged slightly lower on Monday‚ after surging to its highest against the US dollar in more than three months on Friday following disappointing US job figures‚ which bolstered the case for the Federal Reserve to initiate another round of fiscal stimulus.
"Risk appetite has returned to the markets‚ and the current environment is favourable for most risky assets‚" said Jon Jonsson‚ who manages JP Morgan's EX-G4 currency fund.
A short squeeze could send the euro to between $1.28 and $1.30 in the near term‚ said KMJ Capital head Ken Jakubzak. He said the rally will likely wilt past those levels.
Other market participants said their positions were heavily geared toward the next important calendar events - the German court ruling regarding the European Stability Mechanism (ESM) on September 12 and the Fed's Open Market Committee meeting September 12 - 13.
Mr. Jonsson said despite the recent spate of encouraging developments‚ he is still neutrally positioned in the euro‚ wary of the eurozone's lagging growth.
“Rand bulls will be hoping for ESM ratification out of Germany and more stimulus from the US Federal Reserve. Such an outcome could propel the rand down to the lower realms of the aforementioned trading range‚ if not the 8.00/US dollar-handle‚” Absa Capital analysts noted.
Although the euro was slightly lower on the day‚ it soared 1.5% against the dollar on Friday following the poor US jobs figures.
At 11:35‚ the rand was bid at R8.1763 to the dollar from R8.1881 at Friday’s close. It was bid at R10.4439 to the euro from its previous close of R10.4752 and at R13.0762 against sterling from R13.1038 before.
The euro was bid at $1.2781 from $1.2796 at Friday’s close.
“The rand has traded consistently within an 8.05-8.55 range against the US dollar for more than three months‚ but now that northern hemisphere participants are back to their desks in earnest after the summer holidays‚ we believe there could be more decisive rand price action‚” Absa Capital said in its morning report.
“We still favour a downside break (i.e. rand bullish) of this range over the coming months‚ but much will depend on the outcome of this month’s deluge of critical events and the outcome of the high-frequency data flows‚” it said.
“This week is laced with important international developments‚” Absa Capital said.
Dow Jones Newswires reported that the euro nudged slightly lower on Monday‚ after surging to its highest against the US dollar in more than three months on Friday following disappointing US job figures‚ which bolstered the case for the Federal Reserve to initiate another round of fiscal stimulus.
"Risk appetite has returned to the markets‚ and the current environment is favourable for most risky assets‚" said Jon Jonsson‚ who manages JP Morgan's EX-G4 currency fund.
A short squeeze could send the euro to between $1.28 and $1.30 in the near term‚ said KMJ Capital head Ken Jakubzak. He said the rally will likely wilt past those levels.
Other market participants said their positions were heavily geared toward the next important calendar events - the German court ruling regarding the European Stability Mechanism (ESM) on September 12 and the Fed's Open Market Committee meeting September 12 - 13.
Mr. Jonsson said despite the recent spate of encouraging developments‚ he is still neutrally positioned in the euro‚ wary of the eurozone's lagging growth.
“Rand bulls will be hoping for ESM ratification out of Germany and more stimulus from the US Federal Reserve. Such an outcome could propel the rand down to the lower realms of the aforementioned trading range‚ if not the 8.00/US dollar-handle‚” Absa Capital analysts noted.