Johannesburg – The rand retraced some of its morning gains in afternoon trade on Thursday‚ after gaining value due to rumours that the Republicans and the Democrats in the US had possibly come to an agreement to avoid the US fiscal cliff of higher taxes and lower spending. But the rand gave back value after the release of some negative local data prints.
“The local SA data today were all negative with the PPI at 5.2% in October year on year from an expected 4.8%‚ which is negative news for cutting interest rates. Credit extension figures were lower than expected - in other words the consumer is not spending - which is also negative for the rand‚” Mark Kalkwarf‚ currency trader at Iquad Group said.
“The money supply figure at 5.7% for October was also lower than an expected 7.4%‚ indicating that growth is just not there‚” he said.
At 16:01‚ the rand was bid at R8.7908/$ from Wednesday’s close of R8.8190.
The local currency was bid at R11.4203/€ from its previous close of R11.4186 and at R14.0933 against sterling from R14.1167 before.
The euro was bid at $1.2986‚ from $1.2951 at its previous close.