#RandReport: Rand falls as risk demand cools, stocks inch up

Please log in or register to like posts.
News
#RandReport: Rand falls as risk demand cools, stocks inch up

At 1508 GMT, the rand was 0.43% weaker at 13.8850 per dollar, compared to a close of 13.8250 on Monday.

Picture: Supplied.

JOHANNESBURG – The rand fell on Tuesday, ending a rally that had seen the currency breach a key technical mark, amid cooling demand for emerging-market currencies that had been fuelled by optimism over US-China trade talks.At 1508 GMT, the rand was 0.43% weaker at 13.8850 per dollar, compared to a close of 13.8250 on Monday.The rand has traded below the psychologically significant 14.00 per dollar level for the past few sessions as last Wednesday’s budget lowered market bets of a credit rating cut by Moody’s after a week of power cuts by utility Eskom had spooked investors.Demand for the rand and other emerging market currencies in the previous session was boosted by US President Donald Trump’s decision to delay a deadline for increasing tariffs on Chinese imports.But risk demand faded on Tuesday after Trump said a US-China trade deal is not a certainty, even though talks have made progress.“With easing trade tensions seen to be stimulating risk appetite and the dollar likely to weaken further on Fed rate pause expectations, the South African rand, like many other emerging market currencies, has scope to appreciate further,” Lukman Otunuga, research analyst at FXTM, said in a note.“In regards to the technical picture, technical traders will continue to closely observe how the USDZAR behaves around the 13.800 level.”Federal Reserve Chairman Jerome Powell said on Tuesday rising risks and recent soft data shouldn’t prevent solid growth for the US economy this year, but the Fed will remain “patient” in deciding on further interest rate hikes.Bonds firmed, with the yield on the benchmark 10-year government issue falling 4.5 basis points to close at 8.65%. On the bourse, stocks ended higher, led by Shoprite after the retailer gave a somewhat upbeat outlook after reporting its worst half-year performance in a decade.The blue-chip JSE Top-40 index was up 0.66% at 49,965 and the broader All-share index ended 0.65% higher at 56,242.Shoprite topped the gainers list on the benchmark index, rising 4.89% to R169.75 after the company said it had seen evidence of improved sales since January.

Reactions

0
0
0
0
0
0
Already reacted for this post.

Reactions

Nobody liked ?

Leave a Reply

Your email address will not be published.