After weakening yesterday, South Africa’s rand recovered and is currently trading in the lower 7.80/$. CPI inflation data released yesterday was better than expected, today we have PPI data and market expectation is at -3.8 percent. The inflation data should not impact the rand too much; however 2nd quarter GDP data which will be released tomorrow will be watched by traders and investors. In the meantime we should remain in a 7.75/$ to 7.95/$ trading range.
The dollar fell against a basket of currencies on Thursday after China’s central bank said it would stick to a loose monetary policy to consolidate its economic recovery, easing market worries about its growth. Chinese stocks rose, though in volatile trade, and encouraged some investors to crawl back to riskier and higher-yielding currencies such as the Australian dollar. The Chinese central bank’s vice governor, Su Ning, was reported as saying it would also use market tools instead of quota-style controls to ensure credit growth is appropriate. His remarks came after Chinese stocks fell the most in eight months on Wednesday amid worries that China may take steps to tighten money supply and banks could begin to restrict lending.
Current levels
Rand / Usd
7.8000-7.8500
Rand / Euro
11.0000-11.0500
Rand / Sterling
12.9000-12.9500
Jpy / Rand
12.10-12.15
Jpy / Usd
95.00
Usd / Euro
1.4075
Gbp / Usd
1.6485
Gold
$930.00
Brent
$67.00
Expected ranges
Rand / Usd
7.7500-7.9500
Rand / Euro
11.0000-11.2000
Rand / Sterling
12.8000-13.0000
Jpy / Rand
12.00-12.20