RDG BROKERS » market

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

Rand Holding Ground

RDG Brokers — Thu, 26 Nov 2009 12:15:01 +0000

South Africa’s rand continued to rally in late afternoon trade yesterday, after the euro broke back above 1.50 against the dollar. Gold is once again trading at an all time high this morning which is a further positive for the local unit. Inflation data released yesterday showed that CPI fell back into the MPC targets at 5.9 percent, however economists expect inflation to rise again. We have seen solid importer demand at current levels and we are back at levels where S.A. Reserve Bank is not comfortable with the rand’s strength, but with the higher commodity prices there could be scope for further strength. 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

Exchange Control Relaxed

RDG Brokers — Wed, 28 Oct 2009 13:37:29 +0000

After yesterday’s action the release of CPI today should be a non event. Market expectations are at 6.2 percent slightly lower than last month. However the big mover yesterday was the budget speech. Even though the relaxation of exchange control measures we perceived as positive the huge projected budget deficit over the next few years had a negative impact on the rand. It is clear that department of finance also prefer a weaker rand. Taking all these negative factors in consideration the rand actually performed well to be at 7.67/$ this morning. Euro and gold dropped so a move toward 7.80/$ is possible. U.S. Treasury Secretary Timothy Geithner on Tuesday said the dollar would remain the world’s main reserve currency for a long time as the country takes the right measures to support the economy. “I think the dollar will remain the principal reserve currency for a long period of time,” Geithner said at a conference sponsored by the Securities Industry and Financial Markets Association in New York. However, he also said the dollar’s position is not a privilege and comes with responsibilities and obligations that the United States must uphold.
Current levels
Rand / Usd	7.6500-7.7000
Rand / Euro	11.3300-11.3800
Rand / Sterling	12.5300-12.5800
Jpy / Rand	11.90 -11.95
Jpy / Usd	91.33
Usd / Euro	1.4833
Gbp / Usd	1.6369
Gold	$1 040.00
Brent	$77.75
Expected ranges
Rand / Usd	7.5800-7.7800
Rand / Euro	11.2500-11.4500
Rand / Sterling	12.4500-12.6500
Jpy / Rand	11.80-12.00

Watch the interest rates!!

RDG Brokers — Wed, 07 Oct 2009 09:47:07 +0000

South Africa’s rand continued to strengthen mainly on the back of positive emerging market sentiment. Higher rates in Australia send out a positive signal that we are entering into a higher interest rate cycle. There are rumours in the local market that MTN and Bharti are in private talks, which has not been denied or confirmed. This is probably the main reason for the rand’s strength. U.S. labor and manufacturing groups urged President Barack Obama on Tuesday to live up to his campaign rhetoric and formally label China a currency manipulator in a Treasury Department report due out next week. But Nicholas Lardy, a China economic policy watcher at the Peterson Institute for International Economics, said he’d be “shocked” if Obama took that step now. Obama faces his second decision on the currency issue in a semi-annual report due to Congress on Oct. 15. During last year’s campaign, Obama criticized then-President George W. Bush for repeatedly failing to label Beijing a currency manipulator, but then made the same decision in his first stab at the issue in April. Obama’s Treasury Department said China’s currency, the renminbi, remained “undervalued,” but Beijing had allowed the currency to rise 16.6 percent in real terms between June 2008 and the end of February 2009.
Current levels
Rand / Usd	7.4000-7.4500
Rand / Euro	10.9000-10.9500
Rand / Sterling	11.7500-11.8000
Jpy / Rand	11.89-11.94
Jpy / Usd	88.44
Usd / Euro	1.4715
Gbp / Usd	1.5915
Gold	$1 041.00
Brent	$69.15
Expected ranges
Rand / Usd	7.3500-7.5500
Rand / Euro	10.8500-11.0500
Rand / Sterling	11.7000-11.9000
Jpy / Rand	11.85-12.05

“No Surprise”

RDG Brokers — Thu, 01 Oct 2009 23:15:46 +0000

We had an extremely volatile session yesterday after the trade deficit was announced at almost 2 billion rand, much higher than the expected 300 million the rand started weakening. In late afternoon trade it was announced that the MTN/Bharti transaction has been cancelled, this caused panic buying by traders pushing the local unit towards 7.60/$. The euro is lower this morning and with all the negative news out the rand will remain under pressure. German central bank Chief Alex Weber rejected on Wednesday calls for Berlin to help reduce global financial imbalances with policy action that would cut the country’s exports and current account surpluses. “This is not something policy should target or can target. It would mean intervening against optimal structures that have developed in a free market environment,” he told reporters during an economic seminar. Weber heads the German Bundesbank.
Current levels
Rand / Usd	7.5500-7.6000
Rand / Euro	11.0000-11.0500
Rand / Sterling	12.0700-12.1200
Jpy / Rand	11.85-11.90
Jpy / Usd	90.00
Usd / Euro	1.4563
Gbp / Usd	1.5955
Gold	$1 005.00
Brent	$68.44
Expected ranges
Rand / Usd	7.5000-7.7000
Rand / Euro	11.0000-11.2000
Rand / Sterling	12.0000-12.2000
Jpy / Rand	11.80-12.00

Positive corporate Results

RDG Brokers — Wed, 26 Aug 2009 09:59:53 +0000

South Africa’s rand traded in narrow ranges yesterday, as market players were sidelined waiting for fresh economic indicators. We have CPI data at 11h30 this morning which is expected to be at 6.6 percent. On the global side will analysts watch this afternoon the release of U.S. housing figures. We should continue to see consolidation, keeping an eye on the MTN/Bharti deal……

Japanese stocks rose to a 10-month high on Wednesday, driven by a modest shift into defensive sectors, while stocks in Shanghai turned positive on the week as investors cheered corporate results. Thin summer trading volumes, however, kept prices choppy and markets generally remained in ranges. Major European stock futures were down 0.2 percent STXEc1 after the cash market closed at the highest since early October, while U.S. stocks futures were up 0.4 percent SPc1, set to extend gains after U.S. single-family home prices grew for a second straight month. The Ifo survey of German business sentiment is expected to show an across the board pickup later on Wednesday, playing into the story that recoveries are taking hold around the world.

Current levels

Rand / Usd
7.7700-7.8100

Rand / Euro
11.1200-11.1700

Rand / Sterling
12.6000-12.6500

Jpy / Rand
12.07-12.12

Jpy / Usd
94.12

Usd / Euro
1.4315

Gbp / Usd
1.6327

Gold
$948.00

Brent
$71.95

Expected ranges

Rand / Usd
7.6500-7.8500

Rand / Euro
11.0000-11.2000

Rand / Sterling
12.5500-12.7500

Jpy / Rand
12.05-12.25

Dollar Strengthens

RDG Brokers — Fri, 07 Aug 2009 09:32:09 +0000

South Africa’s rand broke above 8.00/$ yesterday, triggering stop loss orders causing the local unit to weaken close to 8.10/$. The euro which is seen as our major trading currency weakened against the dollar giving traders a reason to sell rand. The market has been good to both importers and exporters who has been patient, trading the 7.70/$ to 8.30/$ range. While market players got excited about the MTN/Bharti transaction generating between 2 to 4 billion dollars inflow, how about 2 million tourists coming to the soccer world cup next year spending each only R 30 000, the sum is quite a large inflow?

The dollar edged lower against a basket of currencies in a subdued market on Friday with investors largely staying on the sidelines ahead of key jobs data in the United States. The Australian dollar rose briefly after the Reserve Bank of Australia, which raised its growth forecast in a quarterly monetary policy statement, said interest rates could be expected to rise to more normal levels over time should the economy continue to improve.

Current levels
Rand / Usd
8.0500-8.1000
Rand / Euro
11.5500-11.6000
Rand / Sterling
13.5000-13.5500
Jpy / Rand
11.55-11.60
Jpy / Usd
95.40
Usd / Euro
1.4355
Gbp / Usd
1.6769
Gold
$961.00
Brent
$74.80
Expected ranges
Rand / Usd
7.9000-8.1000
Rand / Euro
11.4500-11.6500
Rand / Sterling
13.4000-13.6000
Jpy / Rand
11.50-11.70