• Voter paralysis

    With so much tilting voters against change, democratic reason is the loser, says Solly Moeng.

  • The power of perseverance

    True grit is a reliable predictor of who will achieve success in life, says Ian Mann.

  • It's the system

    The system sucks and it’s being used far too often as an excuse, says Mandi Smallhorne.

All data is delayed
Loading...
See More

Rand licks wounds after ECB letdown

Aug 03 2012 09:13
Reuters

Johannesburg - The rand weakened against the dollar on Friday after the European Central Bank decided to delay any remedy for the region’s debt crisis, sending Spanish and Italian borrowing costs higher and denting investors’ appetite for risky assets.

The rand was 0.39% weaker at R8.3625 against the greenback at 06:53 GMT, from Thursday’s New York close of R8.34.

Investors had been bracing themselves for another round of bond buying from the ECB to help lower crippling borrowing costs for Spain and Italy.

But ECB President Mario Draghi indicated that any intervention would start in September at the earliest and would depend on countries in borrowing trouble making a formal request and accepting strict conditions and supervision.

“The rand is likely to remain under pressure until decisive action is taken by the world’s major central banks,” Rand Merchant Bank said in a note.

Major focus is also on US non-farm payrolls data due at 12:30 GMT.

“I would imagine non-farm payrolls later this afternoon is going to be a big driver, so I would imagine fairly quite trading until then. It will be probably range-bound trade between R8.30-R8.40” said a Johannesburg rand trader.

The rand often tracks the euro, the currency of its main trading partner. The relationship has meant a very volatile year for the currency of Africa’s biggest economy.

Government bonds firmed, with both yields on the main benchmark bonds down three basis points to 5.510% for the three year bond and 7.345% for the longer-dated 14-year paper.

 
ecb  |  bonds  |  rand  |  markets

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
Comments have been closed for this article.
 

Company Snapshot

We're talking about:

THE DEBT ISSUE

Debt is one of the biggest financial issues facing South Africans today. Find out how you can avoid and manage your debt with Fin24 and Debt Rescue.
 

Money Clinic

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

Voting Booth

Would you take out a payday loan?

Previous results · Suggest a vote

Loading...