Rand takes breather after best run in months

The rand flirted with R13.20/$-level on Friday morning before weakening somewhat, following its strong showing on Thursday afternoon. 

It opened Friday at R13.30/$, and strengthened to R13.22 before weakening to trade at R13.34 to the greenback at 10:10, down 0.37% on the day.

The dollar index, which tracks the dollar's relative strength against a basket of currencies of its major trading partners, was 95.19 at 10:21, up 0.39%. 

Earlier in the week economists were debating whether the local currency would break below the R13.50/$-level due to a combination of risk-off sentiment for emerging markets caused by US President Donald Trump's tariffs clash with China, and a strong dollar.

But following the release of US inflation figures on Thursday afternoon, the rand strengthened by 1.6% for one of its best days in months. 

“The South African currency was [on Thursday] one of the top-performing emerging market currencies amid improved emerging market sentiment as China held off from retaliating against fresh US tariff threats,” said NKC African Economics in a morning note. 

“The rand was also boosted by slightly better-than-expected (albeit overall still fairly gloomy) mining and manufacturing production data and flat US dollar following the release of US inflation figures that were in line with expectations.”

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