Share

Rand softer on euro weakness

Johannesburg - The rand was a tad softer against the dollar in noon trade on Wednesday after breaking the 7.90 level earlier, while the euro lost ground in spite of good economic data out of Germany.

"The rand is just following the euro, and that's about it," a local currency trader said.

"It all boils down to debt concerns over Greece," he said.

At 11:40 local time, the rand was bid at R7.9620 to the dollar from its previous close of R7.9496, after earlier trading at 7.8920. It was bid at R10.3567 to the euro from R10.3643 before, and at R12.3794 against sterling from R12.4196 previously.

The euro was bid at $1.2998 from its previous close of $1.3034.

Dow Jones Newswires reported that in European trading hours, the euro had weakened against the dollar, despite the release of a better-than-expected German Ifo index.

The Ifo index for January came in at 108.3 points, against expectations of a reading of 107.6.

"The outcome is good news for the German economy and it follows a 'healthy' improvement, also in German PMIs (purchasing managers' indices) earlier this week," said Newedge.

An improvement in January's Ifo reading showed further decline was unlikely, a top economist from Germany's Ifo Institute told Dow Jones Newswires following the release of the data.

However, Ifo's Klaus Abberger added that it was too early to take Germany's economic upswing for granted due to the eurozone sovereign debt crisis.

German confidence improved for the third month running in January, showing "Germany isn't sliding into a dip, but is rather on the way to improving a bit again", Abberger said.

The market would now turn to the outcome of the US Federal Open Market Committee's (FOMC's) comments, scheduled to be released later on Wednesday, when it was expected to reveal when its 17 officials expect the economy to be strong enough to justify an interest rate rise.

While the FOMC was expected to preserve its current policy in January, the statement and interest rate projections were expected to affect the currency market as investors contemplated prospects for future policy decisions.

Analysts said that if the FOMC signalled it would keep rates low into 2014, longer than the current commitment for the middle of the 2013, dollar selling could take place.
We live in a world where facts and fiction get blurred
Who we choose to trust can have a profound impact on our lives. Join thousands of devoted South Africans who look to News24 to bring them news they can trust every day. As we celebrate 25 years, become a News24 subscriber as we strive to keep you informed, inspired and empowered.
Join News24 today
heading
description
username
Show Comments ()
Rand - Dollar
18.93
+0.0%
Rand - Pound
23.90
+0.0%
Rand - Euro
20.40
+0.1%
Rand - Aus dollar
12.33
+0.1%
Rand - Yen
0.13
-0.0%
Platinum
908.05
+1.2%
Palladium
1,014.94
+1.3%
Gold
2,232.75
-0.0%
Silver
24.95
-0.1%
Brent Crude
87.00
+1.8%
Top 40
68,346
0.0%
All Share
74,536
0.0%
Resource 10
57,251
0.0%
Industrial 25
103,936
0.0%
Financial 15
16,502
0.0%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

LEARN MORE
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders