The dollar was under pressure on all fronts on Thursday, after breaking down to 15-month lows the previous day, and looked in peril of marking a 14-year low against the yen as Japan signaled it was watching but unlikely to step in. Dealers said short-term players continued to sell the dollar against the Japanese currency, after it fell to a 10-month low of 87.21 yen JPY= on Wednesday, although Japanese companies were buying dollars at the lower levels, helping keep it off the low. The catalyst for Wednesday’s breakdown, which took the greenback to a 15-month low against the euro and a basket of currencies, was an indication from the Federal Reserve that the dollar’s fall has been orderly and interest rates will stay low for some time. Market players said it was likely to remain under pressure in potentially volatile trading on Thursday, when U.S. markets are closed for Thanksgiving. But talk of an options barrier at 87.00 yen, as well as expected buy orders ahead of last January’s 13-year low of 87.10 yen, could lend it some support. Current levels Rand / Usd 7.3300-7.3800 Rand / Euro 11.1000-11.1500 Rand / Sterling 12.2500-12.3000 Jpy / Rand 11.75-11.80 Jpy / Usd 86.70 Usd / Euro 1.5105 Gbp / Usd 1.6688 Gold $1 193.00 Expected ranges Rand / Usd 7.3000-7.5000 Rand / Euro 11.0500-11.2500 Rand / Sterling 12.1500-12.3500 Jpy / Rand 11.70-11.90

article courtesy of Accredinet Financial Solutions

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 ]]> http://rdgbrokers.co.za/2009/11/gdp-outperforms-expectations/feed/ 0 http://rdgbrokers.co.za/2009/11/positive-outlook/ http://rdgbrokers.co.za/2009/11/positive-outlook/#comments Fri, 06 Nov 2009 07:26:29 +0000 RDG Brokers http://rdgbrokers.co.za/?p=303 South Africa’s rand held onto gains and is slightly stronger this morning. Most emerging market currencies are benefiting from a positive global economic outlook. Trading should be quiet ahead of the release of U.S. jobs data this afternoon. While the euro, gold and other commodities remain well supported the rand will remain strong.

The U.S. dollar held steady on Friday with investors consolidating positions ahead of October non-farm payrolls data due later in the session, a report that would highlight the durability of an economic recovery. A Reuters poll showed median forecasts are for 175,000 jobs being shed, slower than the 263,000 lost in September, with the jobless rate rising to 9.9 percent. If the numbers disappoint, investors are likely to flock to the U.S dollar and the yen JPY=, while a strong report could see high-yielding currencies gain. Current levels Rand / Usd 7.5900-7.6400 Rand / Euro 11.2800-11.3300 Rand / Sterling 12.6000-12.6500 Jpy / Rand 11.90 -11.95 Jpy / Usd 90.645 Usd / Euro 1.4875 Gbp / Usd 1.6620 Gold $1 091.00 Brent $78.63 Expected ranges Rand / Usd 7.53000-7.7300 Rand / Euro 11.2000-11.4000 Rand / Sterling 12.5000-12.7000 Jpy / Rand 11.85-12.05 ]]> http://rdgbrokers.co.za/2009/11/positive-outlook/feed/ 0 http://rdgbrokers.co.za/2009/10/markets-slightly-bearish/ http://rdgbrokers.co.za/2009/10/markets-slightly-bearish/#comments Tue, 27 Oct 2009 08:18:09 +0000 RDG Brokers http://rdgbrokers.co.za/?p=297

South Africa’s rand weakened yesterday, breaking above the 7.50/$ mark in quiet trading conditions. Local traders saw off shore fund managers selling rand for currency as the emerging market sentiment turned slightly bearish as the Dow Jones closed once again below the 10 000 mark with analysts cited a correlation between the Dow and emerging markets. Gold is down, euro back below 1.50 which will keep pressure on the rand. Traders will keep an eye on the mini budget this afternoon for future movements on the local unit. The dollar eased against a basket of currencies on Tuesday, trimming some of the previous day’s sharp gains as investor selling of stretched higher-yielding currencies and the euro paused. The euro had its steepest drop since early August on Monday, falling nearly 1 percent, and the dollar index posted its best daily gain since September as investors unwound short dollar positions after a sharp fall in stocks and commodities. The euro drew some demand from Asian investors, recovering from the day’s lows, while the Aussie rebounded as some market players remained doubtful that the low-yielding dollar would strengthen further. But other traders said the dollar may rise more in the near term as short-term speculators take profits from their bets this year on risky assets with the approach of their business year-end, which typically comes in November.
Current levels
Rand / Usd	7.5300-7.5800
Rand / Euro	11.2200-11.2700
Rand / Sterling	12.3200-12.3700
Jpy / Rand	12.15 -12.20
Jpy / Usd	92.05
Usd / Euro	1.4905
Gbp / Usd	1.6340
Gold	$1 042.00
Brent	$77.35
Expected ranges
Rand / Usd	7.4000-7.6000
Rand / Euro	11.1500-11.3500
Rand / Sterling	12.2000-12.4000
Jpy / Rand	12.10-12.30

]]> http://rdgbrokers.co.za/2009/10/markets-slightly-bearish/feed/ 0 http://rdgbrokers.co.za/2009/09/trading-a-little-quiet/ http://rdgbrokers.co.za/2009/09/trading-a-little-quiet/#comments Mon, 28 Sep 2009 15:45:29 +0000 RDG Brokers http://rdgbrokers.co.za/?p=266 South Africa’s rand traded sideways over the weekend. The local unit is trading almost unchanged from Friday afternoon. Trading should remain quiet with quite a few companies having financial year end or half year end. Gold is back below $ 1 000 and the euro is also weaker this morning, however we are still experiencing abnormal trading conditions as traders still await the introduction of the proceeds of the MTN/Bharti transaction. While the transaction is still pending fundamentals will be ignored.

Restoring economic growth is more of an immediate priority than tackling currency imbalances, French Economy Minister Christine Lagarde said on Sunday. Lagarde told French television that the G20 will be the forum where global currencies are discussed and said the euro must not be made to suffer at the expense of the U.S. dollar and Chinese Yuan. But she added that this was not her most pressing concern. Current levels Rand / Usd 7.4500-7.5000 Rand / Euro 10.9000-10.9500 Rand / Sterling 11.8000-11.8500 Jpy / Rand 11.95-12.00 Jpy / Usd 89.35 Usd / Euro 1.4611 Gbp / Usd 1.5830 Gold $989.00 Brent $64.60 Expected ranges Rand / Usd 7.4000-7.6000 Rand / Euro 10.8500-11.0500 Rand / Sterling 11.7500-11.9500 Jpy / Rand 11.90-12.10 ]]> http://rdgbrokers.co.za/2009/09/trading-a-little-quiet/feed/ 0 http://rdgbrokers.co.za/2009/09/gold-is-back/ http://rdgbrokers.co.za/2009/09/gold-is-back/#comments Tue, 22 Sep 2009 09:19:56 +0000 RDG Brokers http://rdgbrokers.co.za/?p=262 South Africa’s rand strengthened to back below the 7.50/$ mark after the euro and pound recovered overnight. Gold is back above the $ 1000.00 mark which is another positive. Most traders will be waiting for the MPC announcement this afternoon, the press conference is scheduled for 15h00. We have inflation data this morning, the general consensus is that inflation will continue to decline to 6.3 percent.

Iran has replaced the U.S. dollar with the euro in calculating the value of its Oil Stabilization Fund (OSF), Iranian media reported on Monday. The decision was made earlier this month by President Mahmoud Ahmadinejad, based on a recommendation by the board of directors of the fund, the Poul business daily reported, without citing any official sources. State radio said the move was taken because the government wished to protect itself from the fragility of the U.S. economy and the weak dollar. The Central Bank of Iran, contacted by telephone, declined to comment. The OSF, which forms part of Iran’s foreign exchange reserves, is a contingency fund set aside by the government to cushion the economy against fluctuating international oil prices and help both the public and private sectors with their hard currency needs by extending loans. Current levels Rand / Usd 7.4300-7.4800 Rand / Euro 10.9600-11.0100 Rand / Sterling 12.1000-12.1500 Jpy / Rand 12.26-12.31 Jpy / Usd 91.57 Usd / Euro 1.4725 Gbp / Usd 1.6275 Gold $1 007.50 Brent $68.93 Expected ranges Rand / Usd 7.4000-7.6000 Rand / Euro 10.9000-11.1000 Rand / Sterling 12.0500-12.2500 Jpy / Rand 12.20-12.40 ]]> http://rdgbrokers.co.za/2009/09/gold-is-back/feed/ 0