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Rand falls by over 1% against the dollar, has 'nowhere to hide'

Aug 12 2019 11:52

The rand weakened by over 1% against the dollar on Monday morning, compounding losses incurred last week. 

At 11:20 the local currency was trading at R15.43 to the greenback, after opening the day at R15.26/$. 

In a morning note to clients Bianca Botes of Peregrine Treasury Solutions said risk-off sentiment caused by the US/China trade war was impacting the rand. 

"Donald Trump’s comment on Friday that trade talks with China due to start on 1 September might be cancelled, after also having announced additional tariffs on China, is adding pressure to the fragility of investor sentiment." 

This is despite indications that the rand is "oversold at these levels and that a retracement is on the cards", she said. 

Adam Phillips, a treasury specialist at Umkhulu Consulting, said in a statement that the rand was the worst performing emerging market currency at the moment. 

"International and local issues means it just does not have anywhere to hide," he said. "Whether it is Eskom, Trump, [the] US economy or CR17 donation concerns, it is all playing a part". 

rand  |  markets  |  currencies

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