UPDATE: Rand runs on US inflation data and easing world tensions | Fin24

UPDATE: Rand runs on US inflation data and easing world tensions

May 10 2018 14:51

Cape Town - The rand rallied on Thursday, flirting with the R12.30/$ level after US consumer inflation numbers came in lower than expected at only 2.1% for April. Analysts expected CPI to rise by 2.5%.

Emerging market currencies came under pressure when US President Donald Trump withdrew from the nuclear deal with Iran and reimpose sanctions on the oil-rich country.

Locally a protracted bus strike and sporadic violent protests also weighed on the rand.

But on Wednesday, the local unit recouped some of its losses during the overnight trading session, pulling back from R12.70/$ to R12.56 as traders booked profits. This continued on Thursday, boosting the rand to strengthen over 1% against the dollar.

The US CPI print boosted the rand further and by 14:46 the unit was trading 1.65% firmer at R12.34/$ after reaching an intraday high of R21.31 to the greenback.

"All emerging markets currencies are currently on the front foot. We're seeing a bit of a correction and a risk-on scenario," a TreasuryONE dealer told Fin24 on Thursday.

In April the rand, with a drop of 5.1% against the dollar, represented the third-worst return from a basket of emerging market currencies.

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donald trump  |  markets  |  currencies  |  rand


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