Johannesburg – The rand was a tad firmer at noon on Monday on a slightly weaker dollar.
“The market is very quiet; the euro is a bit stronger and the dollar a bit weaker. There are no major headlines out - no news to give the rand direction‚” said Jim Bryson‚ currency trader at Rand Merchant Bank. Elna Moolman‚ economist at Renaissance Capital‚ said: “The rand’s further depreciation last week provided additional support to our longstanding view that the South African Reserve Bank (Sarb) will not cut interest rates this week.”
“The rand‚ which is weaker than we expected‚ remains in our view the key upside risk to the inflation outlook. The rand lost about 2.5% vs the dollar and 3.1% vs the euro last week‚ while most of its peers lost only up to about 1.6%. The Brazilian real weakened 1% against the dollar and 1.6% against the euro‚ while the Australian dollar lost 0.5% against the dollar and 1% against the euro‚” Moolman said in a note.
“Clearly‚ the rand’s sell-off was owing to a combination of rising concerns about the global economic outlook and self-inflicted domestic problems‚” she added.
At 11:55‚ the rand was bid at R8.8471/$ from Friday’s close of R8.8533 and Thursday’s close of R8.9020. The local currency was bid at R11.2964/€ from its previous close of R11.2864 and at R14.0615 against sterling from R14.0642 before.
The euro was bid at $1.2769‚ from Friday’s close of $1.2759.