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Johannesburg - The rand recovered some of Tuesday’s losses at midday on Wednesday after higher than expected consumer price index (CPI) figures slashed any hopes of a rate cut by the Reserve Bank’s monetary policy committee on Thursday.
“Markets are catching their breath this morning‚ but the risk is still to the upside – any bad headlines will continue to drive the market. The CPI figures came out a little higher than expectations‚ which dampened hope of a rate cut and the rand strengthened a little on that‚” said Ian Martin a currency trader at RMB.
SA’s CPI‚ which the Reserve Bank uses to target inflation‚ was unchanged at 5.9% year on year in April‚ Statistics SA (Stats SA) said on Wednesday. The inflation rate was expected to have come in at 5.8% year on year‚ according to a survey of leading economists by I-Net Bridge.
At 11:27 the rand was bid at R9.5149/$ from R9.5467 at Tuesday’s close and R9.4313 at Monday’s close. The local currency was bid at R12.3034/€ from its previous close of R12.3288 and was at R14.3529 against sterling from R14.4675 at its previous close.
The euro was bid at $1.2929 from $1.2916 at Tuesday’s close and $1.2897 at Monday’s close.
