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Johannesburg, Dec 8 (I-Net Bridge) - The rand lost ground against the dollar in choppy trade on Thursday, ahead of key announcements expected out of the eurozone, starting with the European Central Bank's (ECB) interest rate decision.
At 11:38 local time, the rand was bid at 8.0799 to the dollar from its previous close of 8.0106. It was bid at 10.8281 to the euro from 10.7359 before, and at 12.6957 against sterling from 12.5758 previously.
The euro was bid at US$1.3399, unchanged from its previous close.
A local dealer noted some importer demand ahead of the rates announcement.
RMB analysts noted choppy trade in a morning report ahead of today's key events - the ECB's interest rate decision at 14:45 and European leaders holding a pre-summit at mid-day.
The rand is gyrating in a 7.96/98-8.10/12 range for now, but could easily end the day at 7.90 or 8.20, they said.
"There is a surprising degree of uncertainty over today's ECB decision. Most people expect a 25bp cut, some predict 50bp, while others say no move at all. The press conference will be equally as interesting: it's hoped that the bank will extend the duration of its emergency lending to banks, while easing its collateral requirements - these are technical issues but vital for European banks and therefore funding of inflows into SA. It's too early to expect news on the 'bazooka' option - the Bank will wait for politicians to sign off on a new fiscal deal before acting to boost its bond buying - but expect this to be the main focus of the Q&A," the analysts said.
Meanwhile, Dow Jones Newswires reported that in foreign exchanges, the euro hugged tight ranges against the dollar as traders were unwilling to take large positions of the outcomes of the ECB and EU meetings.
The eurozone's debt saga and the future of the single monetary union is expected to be discussed at the European Union summit.
Investors are largely expecting the European Central Bank to cut its main rate by 25 basis points to 1.0% but there was also debate over whether the central bank will introduce quantitative easing measures. Annalisa Piazza, economist at Newedge, was sceptical.
