Johannesburg – The rand weakened on Tuesday as global risk aversion and lowering commodity prices lifted the US dollar.
“The rand fell victim to a stronger dollar and softer commodity prices on Monday. Granted‚ trading volumes were lower than normal due to yesterday’s US public holiday‚ but in essence there is still a lot of uncertainty in the market surrounding how the US fiscal cliff will be handled by US policy makers over the coming weeks‚” Absa Capital said in a note.
At 08:27‚ the rand was bid at R8.7599/$ from Monday’s close of R8.7483. The local currency was bid at R11.1107/€ from its previous close of R11.1108 and at R13.9024/£ from R13.8792 before.
The euro was bid at $1.2686 from Monday’s close of $1.2707.
RMB said in a note: “Gold is reversing some of its gains amid a strengthening dollar but the looming US fiscal cliff should limit any significant decline in the price. Gold ETF (exchange-traded fund) holdings remain steady at record levels‚ while a seasonal pickup in demand from India should provide further support.”
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