Rand benefits from dollar sell-off, stocks flat | Fin24

Rand benefits from dollar sell-off, stocks flat

Oct 30 2015 09:50

Johannesburg - The rand recovered from its weakest in nearly a month in early trade on Friday as investors returned to long positions after marginally weaker-than-expected US growth data took pressure off risky currencies.

The Top-40 index on the Johannesburg Stock Exchange opened flat.

At 08:37 the rand firmed 0.47% to R13.83/$, having fallen as far as 13.8950 the previous day as most emerging currencies dropped in risk-averse trade.

The rand had threatened to touch 14.00 before a US report which showed that growth expanded at 1.5% in the third quarter, slightly less than forecast.

"There is a good chance that last night's dollar sell-off may extend to 13.75 this morning but probably no further. Unsurprisingly we have seen decent local importer demand for dollars over the past couple of days due to month-end covering," Standard Bank currency strategist Warrick Butler said.

Investors will be waiting for local trade data, due at 14:00, for clues on how to play their positions.

"We expect a smaller-than-consensus trade deficit reading today, which implies that the ZAR could enjoy some short covering if these data do surprise to the downside," Barclays economist Peter Worthington said.

Government bonds were broadly flat, with the yield on paper maturing in 2026 unchanged at 8.405%.

rand  |  markets  |  currencies


Company Snapshot

Voting Booth

Do you support a reduction in the public sector wage bill?

Previous results · Suggest a vote