RDG BROKERS » currencies

Rand takes slight knock

RDG Brokers — Fri, 27 Nov 2009 08:32:41 +0000

South Africa’s rand weakened in a volatile session yesterday, breaking back above the 7.50/$ mark overnight. The euro dropped below 1.50 against the dollar as well as a report that Dubai’s debt is much bigger than anticipated was also cited as one of the reasons for our local units weakness. I believe the main reason for this volatility is we are going into silly season and with most major players out, and speculators are having some fun forcing currencies in a direction. Most moves from now till mid January will probably not make any sense! The yen hit its highest level in 14 years on the dollar on Friday and jumped against higher-yielding currencies as investors cut risk trades on concerns about debt problems in Dubai, while Japan signalled growing discomfort with the surge. After plummeting on Thursday, the dollar plunged to a new 14-year trough below 85 yen as investors unwound yen-funded carry trades in the likes of the Australian and New Zealand dollars. In a market made thinner by a U.S. holiday on Thursday, Japanese exporters fuelled the drop by buying yen ahead of the month-end, while traders also dumped dollars due to option triggers at 85.00 yen, and sell orders kicked in below that level.
Current levels
Rand / Usd	7.5500-7.6000
Rand / Euro	11.2800-11.3300
Rand / Sterling	12.4000-12.4500
Jpy / Rand	11.32-11.37
Jpy / Usd	86.18
Usd / Euro	1.4908
Gbp / Usd	1.6390
Gold	$1 170.00
Expected ranges
Rand / Usd	7.4500-7.6500
Rand / Euro	11.2000-11.4000
Rand / Sterling	12.3000-12.5000
Jpy / Rand	11.25-11.45

Courtesy of Accredinet

GDP outperforms Expectations

RDG Brokers — Wed, 25 Nov 2009 07:20:01 +0000

South Africa’s rand rallied yesterday after the release of 3rd Quarter GDP figures. The GDP grew by 0.9 percent confirming that the local economy moved out of the recession. This figure was above market expectations as well as gold steaming ahead, both bullish factors for the local unit. We should remain in a 7.40/$ to 7.50/$ trading range today. Swift interest rate hikes aimed at containing inflation in product and asset prices could cause another downturn in the slowly recovering economies of the United States and Europe, the head of the World Bank said. “Waiting for bubbles to burst and then cleaning up the aftermath is now a new lesson of what not to do,” World Bank President Robert Zoellick said in an article published in Wednesday’s Financial Times. “But tightening interest rates too abruptly — especially where recoveries are weak, such as in the U.S. and Europe — could trigger another downturn.” Zoellick noted that Australia’s central bank had already raised interest rates, which may put Asian countries with close links to Australia’s economy under pressure to follow suit. “But raising rates while the Fed keeps its rates close to zero would cause Asian currencies to appreciate. This would make their exports more expensive and decrease overseas sales, hurting recoveries based on exports.” He said there was also competition from China: “The renminbi is tied to a declining U.S. dollar that makes Chinese goods cheaper to buy than those of Asian rivals.”
Current levels
Rand / Usd	7.4000-7.4500
Rand / Euro	11.1400-11.1900
Rand / Sterling	12.3300-12.3800
Jpy / Rand	11.85-11.90
Jpy / Usd	88.38
Usd / Euro	1.4988
Gbp / Usd	1.66618
Gold	$1 177.00
Expected ranges
Rand / Usd	7.3500-7.5500
Rand / Euro	11.1000-11.3000
Rand / Sterling	12.2000-12.4000
Jpy / Rand	11.80-12.00

Recovery in sight for Global Market

RDG Brokers — Wed, 30 Sep 2009 08:49:50 +0000

South Africa’s rand continued to trade in a 7.35/$ to 7.45/$ trading range, with little interest shown by market players. Today is the due date for the MTN/Bharti announcement and the general expectation is that the announcement will be postponed once again. Most other currencies are also trading sideways. Locally we have the release of our trade figures market expectations is at -0.3 billion rand, unless this figure is way out of line it should be a non event. Manufacturing activity powered ahead in Japan and China in September, providing fresh evidence of a global recovery, but other data from Tokyo showed worrisome signs that the impact of massive government stimulus spending may be starting to fade. Japanese manufacturing grew at its fastest pace in three years, with expanding new orders at home and abroad, while factories in China cranked up production for the sixth straight month, private activity indexes showed. Elsewhere, stronger-than-expected retail sales in Australia added to market expectations that its central bank could start to raise interest rates as early as November as the economy regains momentum, while business confidence in New Zealand climbed to its strongest level in a decade. A purchasing managers’ index on China showed a 4 trillion Yuan ($585 billion) government stimulus programme and ultra-loose growth-supportive policy continued to bolster the domestic economy in September, while global demand for Asian goods slowly recovered
Current levels
Rand / Usd	7.3500-7.4000
Rand / Euro	10.8000-10.8500
Rand / Sterling	11.8500-11.9000
Jpy / Rand	12.12 -12.17
Jpy / Usd	89.80
Usd / Euro	1.4619
Gbp / Usd	1.6060
Gold	$997.00
Brent	$65.80
Expected ranges
Rand / Usd	7.33000-7.5300
Rand / Euro	10.8000-11.0000
Rand / Sterling	11.8000-12.0000
Jpy / Rand	12.00-12.20

Rand too Strong??

RDG Brokers — Fri, 11 Sep 2009 07:57:38 +0000

South Africa’s rand weakened yesterday mainly due to profit taking and comments by outgoing Reserve Bank Governor Tito Mboweni and officials from that IMF that a strong rand is not ideal for the South African economy. The local unit weakened to trade above 7.60/$ but is currently slightly stronger at 7.57/$. As we know comments by official only has a short term effect on currencies if there is now physical intervention in the market. Analysts will continue to monitor the MTN/Bharti developments for further clues.

The dollar remained vulnerable on Friday near its lowest level this year against the euro as investors continued to favour other riskier and growth-linked currencies such as the Australian and New Zealand dollars. Improving economic data and company earnings added to growing investor confidence and kept the New Zealand dollar near its highest since late August last year and sterling close to a one-month peak hit on Thursday. The Australian dollar slightly lagged other higher-yielding currencies to rise after weaker-than-expected data on employment and retail sales this week cooled expectations for an interest rate hike as early as next month. But analysts said demand from Asian central banks diversifying their reserves out of the greenback kept providing strong support to the Aussie. Investors waited to see if a slew of Chinese data due on Friday morning will strengthen economic recovery hopes and encourage investors to buy more riskier assets and currencies by selling the low-yielding U.S. dollar.

Current levels

Rand / Usd
7.5500-7.6000

Rand / Euro
11.0000-11.0500

Rand / Sterling
12.6000-12.6500

Jpy / Rand
12.07-12.12

Jpy / Usd
91.40

Usd / Euro
1.4600

Gbp / Usd
1.66695

Gold
$1001.00

Brent
$70.43

Expected ranges

Rand / Usd
7.4500-7.6500

Rand / Euro
10.9000-11.1000

Rand / Sterling
12.5000-12.7000

Jpy / Rand
12.00-12.20

Inflation Declines

RDG Brokers — Thu, 27 Aug 2009 09:16:48 +0000

South Africa’s rand remained in narrow ranges, after CPI data showed another decline. The local unit is slightly weaker after Chinese markets depreciated causing investor to run for safe haven currencies. The violence seen at the Union Buildings by the defense force workers will not do us any favours and if it wasn’t for the possible MTN/Bharti transaction the local unit would probably be a lot weaker.

U.S. stocks closed near break-even on Wednesday despite fresh signs of a modest economic recovery, while rising U.S. crude stockpiles led oil prices to extend sharp losses from the previous session. News that China would act to restrict redundant investments underscored concerns about the global economy and triggered safe-haven buying of the U.S. dollar. Gold futures ended a tad lower, helped by the dollar’s gains, while copper was little changed, weighed down by Chinese constraints on industrial overcapacity. Investors remained cautious after a decent run-up in equity markets, leaving stocks to edge up on the day even after solid reports on U.S. housing and new orders of durable goods.

Current levels

Rand / Usd
7.8300-7.8800

Rand / Euro
11.1800-11.2300

Rand / Sterling
12.7000-12.7500

Jpy / Rand
11.90-11.95

Jpy / Usd
93.40

Usd / Euro
1.4255

Gbp / Usd
1.6214

Gold
$946.00

Brent
$71.25

Expected ranges

Rand / Usd
7.7500-7.9500

Rand / Euro
11.1000-11.3000

Rand / Sterling
12.6500-12.8500

Jpy / Rand
11.80-12.00

Traders on the Fence

RDG Brokers — Tue, 25 Aug 2009 10:16:00 +0000

South Africa’s rand was once again to break below the7.70/$ resistance and profit taking after the rally saw the local unit to weaken towards 7.90/$. Traders will be waiting for important economic data locally as well as the U.S. for further clues on currencies. In the meantime we will probably remain range bound. The yen headed higher on Tuesday as share markets fell and investor interest in higher-yielding currencies ebbed, while currencies took in their stride news that Federal Reserve chief Ben Bernanke would be reappointed. A U.S. administration official said President Barack Obama would reappoint Bernanke for a second term as Fed chairman on Tuesday. The dollar showed little reaction to the news as market participants had thought there was a good chance Bernanke would be given a second term to reassure financial markets as they recover from the global economic crisis, analysts said.

Current levels Rand / Usd 7.8100-7.8600 Rand / Euro 11.1500-11.2000 Rand / Sterling 12.8000-12.8500 Jpy / Rand 11.98-12.03 Jpy / Usd 94.12 Usd / Euro 1.4295 Gbp / Usd 1.6470 Gold $945.00 Brent $73.74 Expected ranges Rand / Usd 7.7500-7.9500 Rand / Euro 11.1000-11.3000 Rand / Sterling 12.7500-12.9500 Jpy / Rand 11.95-12.15

Emerging Markets Bullish

RDG Brokers — Thu, 20 Aug 2009 15:34:27 +0000

South Africa’s rand strengthened overnight after the sentiment turned bullish on emerging markets. We should also keep in mind as we move closer to the 31st of August which is the new date for the report back on the MTN/Bharti negotiations. This deal could generate a substantial inflow of dollars. The euro is also stronger this morning which is another factor supporting the local unit. We are still within the 7.70/$ to 8.30/$ trading range.

The euro rose against the dollar and the yen on Tuesday, recovering from two-week lows after a surprisingly strong poll of German investor sentiment raised some optimism about the euro zone economy. A recovery in European share prices from steep losses the previous day also helped to boost currencies considered to be higher risk which had suffered on Monday. As a result, the dollar and the yen fell across the board. The euro hit the day’s high against the dollar of $1.4155 after the ZEW economic research institute’s economic sentiment index rose to 56.1 in August from 39.5 in July, its highest level since April 2006 and beating forecasts for 45.0. By 1134 GMT, the pair had retreated to $1.4096, little changed on the day but above $1.4045 hit on Monday, its lowest since late July. Some analysts said the poll suggested the German economy would continue to grow this year after data last week showed an unexpected rise in gross domestic product in the second quarter. But others said the survey, which ended its polling period after the GDP data, may have been too optimistic and added the German economy continues to face major hurdles before any recovery, a view which was helping to cap euro gains.

Current levels

Rand / Usd
7.9300-7.9800

Rand / Euro
11.3000-11.3500

Rand / Sterling
13.1500-13.2000

Jpy / Rand
11.83-11.88

Jpy / Usd
94.40

Usd / Euro
1.4220

Gbp / Usd
1.6545

Gold
$944.00

Brent
$74.48

Expected ranges

Rand / Usd
7.9000-8.1000

Rand / Euro
11.2500-11.4500

Rand / Sterling
13.1000-13.3000

Jpy / Rand
11.75-11.95

Rate Cut Good or Bad?

RDG Brokers — Fri, 14 Aug 2009 08:40:19 +0000

South Africa’s rand strengthened to below 8.00/$ yesterday on positive international economic news, however after the announcement by the MPC to cut rates by 50 basis points the local unit weakened to trade at 8.05/$ this morning. The cut was unexpected and while rate cuts were seen as positive a month ago, market sentiment has shifted to favour higher interest rates globally.

The dollar dipped against the yen on Friday, pulling away from eight-week highs hit last week, hurt by the previous day’s disappointing U.S. retail sales data and as the yen rose due to a fall in Chinese shares.

The Australian dollar hit an 11-month high against the dollar and initially rose against the yen after Reserve Bank of Australia Governor Glenn Stevens said normal interest rates for Australia would be noticeably higher than the current 3 percent cash rate. But the Aussie later trimmed gains, with the yen edging higher on crosses as Chinese shares fell 2.4 percent. Falls in equities or data that cast doubts about the outlook for the global economy can dent risk appetite and trigger selling of higher-yielding currencies such as the Australian dollar against the dollar and the yen.

Current levels
Rand / Usd
8.0300-8.0800
Rand / Euro
11.4500-11.5000
Rand / Sterling
13.3000-13.3500
Jpy / Rand
11.80-11.85
Jpy / Usd
96.23
Usd / Euro
1.4256
Gbp / Usd
1.6667
Gold
$955.00
Brent
$73.77

Expected ranges

Rand / Usd
7.9500-8.1500
Rand / Euro
11.3500-11.5500
Rand / Sterling
13.1000-13.4000
Jpy / Rand
11.70-11.90

Oil Price Rises

RDG Brokers — Mon, 03 Aug 2009 15:10:50 +0000

South Africa’s rand traded in a 7.75/$ to 7.85/$ trading range on Friday as economic releases had no impact on the currency markets. The euro and pound is stronger versus the dollar this morning which pushed the rand back below 7.80/$. However reports by the Business Day that MTN and Bharti will report back today with progress on talks and also give more detail of the actual deal will help us see what flows will come into the local market. Most traders will be sidelined until they get more info as the deal has been driving the rand lately.

The dollar fell broadly on Monday and hit its lowest point this year against a basket of currencies after higher oil prices, steady global stock markets and U.S. GDP data boosted investments in riskier assets. The Australian dollar, a commodity-linked currency, climbed to a 10-month high versus the dollar, helped partly by oil prices holding firm around $70 a barrel CLc1 in Asian trade after jumping nearly 4 percent late last week. Commodity prices rose on Friday as data showing U.S. gross domestic product for the second quarter fell at a 1.0 percent annual rate, below analysts’ expectations for a 1.5 percent drop, raising hopes that fuel demand would recover. The dollar’s slide was driven largely by technical factors such as stop-loss buying in sterling, which hit its highest level in nine-months, traders said.

Current levels
Rand / Usd
7.7500-7.8000
Rand / Euro
11.0000-11.0500
Rand / Sterling
12.9800-13.0300
Jpy / Rand
11.0000-11.0500
Jpy / Usd
94.88
Usd / Euro
1.4225
Gbp / Usd
1.6742
Gold
$952.00
Brent
$72.34
Expected ranges
Rand / Usd
7.7000-7.9000
Rand / Euro
10.9500-11.1500
Rand / Sterling
12.9000-13.1000
Jpy / Rand
12.10-12.30

Inflation Looking Better

RDG Brokers — Thu, 30 Jul 2009 08:17:16 +0000

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

RDG BROKERS » currencies

Rand takes slight knock

Courtesy of Accredinet

GDP outperforms Expectations

Recovery in sight for Global Market

Rand too Strong??

Inflation Declines

Traders on the Fence

Emerging Markets Bullish

Rate Cut Good or Bad?

Oil Price Rises

Inflation Looking Better

Courtesy of Accredinet Financial Solutions