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Johannesburg - The rand remained over 1% firmer against the dollar in noon trade on Thursday, after the euro strengthened following Wednesday's EU summit.
"The rand didn't have much of a reaction to the producer price inflation data out earlier as the figure was much in line with expectations," a market analyst said.
"While the rand has strengthened a bit since the data was released, I think that's essentially just continued buying from earlier this morning."
He added that the rand was stronger against all majors - "which is the trend across emerging markets today".
"Risk is back in the short term - just look at some European equities; some of the benchmarks are 4% higher on the day.
"Traders have been saying that the next big dollar rand level is 7.75."
At 11:58 local time, the rand was trading at 7.8223 to the dollar from its previous close of 7.9356. It was trading at 10.9620 to the euro from 11.0307 before, and at 12.5033 against sterling from 12.6603 previously.
The euro was at $1.4016 from $1.3875 before.
The producer price index (PPI) registered growth of 10.5% year-on-year (y/y) in September from 9.6% y/y in August, Statistics South Africa data released on Thursday showed.
The PPI - on a monthly basis - decreased by 3.3% from 1.0% in August.
PPI was expected to have increased at 10.3% y/y in September from the 9.6% y/y seen in August, a survey by I-Net Bridge found. Forecasts among 10 leading economists surveyed ranged from 9.5% y/y to 12.1% y/y.
Meanwhile Dow Jones Newswires reported that in foreign exchange markets, the euro jumped to a seven-week high against the dollar as investors expressed relief that the region's leaders had finally come to an agreement to attempt to resolve the sovereign debt crisis.
"Although details of the EFSF (European Financial Stability Facility) leverage and bank recapitalisation need to be clarified, we think the outcomes from the summit helped to take away the market's fear of extreme tail risk. This should lift risk sentiment in general," said Credit Suisse.
"The rand didn't have much of a reaction to the producer price inflation data out earlier as the figure was much in line with expectations," a market analyst said.
"While the rand has strengthened a bit since the data was released, I think that's essentially just continued buying from earlier this morning."
He added that the rand was stronger against all majors - "which is the trend across emerging markets today".
"Risk is back in the short term - just look at some European equities; some of the benchmarks are 4% higher on the day.
"Traders have been saying that the next big dollar rand level is 7.75."
At 11:58 local time, the rand was trading at 7.8223 to the dollar from its previous close of 7.9356. It was trading at 10.9620 to the euro from 11.0307 before, and at 12.5033 against sterling from 12.6603 previously.
The euro was at $1.4016 from $1.3875 before.
The producer price index (PPI) registered growth of 10.5% year-on-year (y/y) in September from 9.6% y/y in August, Statistics South Africa data released on Thursday showed.
The PPI - on a monthly basis - decreased by 3.3% from 1.0% in August.
PPI was expected to have increased at 10.3% y/y in September from the 9.6% y/y seen in August, a survey by I-Net Bridge found. Forecasts among 10 leading economists surveyed ranged from 9.5% y/y to 12.1% y/y.
Meanwhile Dow Jones Newswires reported that in foreign exchange markets, the euro jumped to a seven-week high against the dollar as investors expressed relief that the region's leaders had finally come to an agreement to attempt to resolve the sovereign debt crisis.
"Although details of the EFSF (European Financial Stability Facility) leverage and bank recapitalisation need to be clarified, we think the outcomes from the summit helped to take away the market's fear of extreme tail risk. This should lift risk sentiment in general," said Credit Suisse.
