RDG BROKERS » trading

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

Markets slightly Bearish

RDG Brokers — Tue, 27 Oct 2009 08:18:09 +0000

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

Watch that Oil Price

RDG Brokers — Thu, 06 Aug 2009 13:31:36 +0000

South Africa’s rand remained under pressure yesterday testing 8.00/$, however local exporter interest prevented it from breaking above the resistance level. We are still trading in the upper 7.90/$ mark and euro strength are ignored by traders and fund managers. We are currently seeing investors withdrawing funds from emerging markets and back into low risk economies after the latest economic indicators were positive for the “old” economies. Trading is relatively quiet however a break above 8.00/$ could see stop loss orders being triggered.

The dollar was steady near this year’s lows against the euro on Thursday with investors bracing for policy decisions by the Bank of England and the European Central Bank later in the day. The dollar fell versus the euro on Wednesday to its lowest point since December after data showing U.S. private employers cut more jobs last month but at the slowest pace since October, offering a glimmer of hope the labour market is stabilising. Sterling held firm near a over nine-month peak against the dollar struck the previous day ahead of the BoE’s expected decision and announcement on interest rates and its quantitative easing programme later on Thursday. Economists are split on whether the BoE will inject more money into the economy by extending its asset purchases at the end of two-day policy meeting at 1100 GMT, although recently brighter British data is seen reducing such chances.

Current levels
Rand / Usd
7.9400-7.9900
Rand / Euro
11.4500-11.5000
Rand / Sterling
13.5000-13.5500
Jpy / Rand
11.91-11.96
Jpy / Usd

95.17

Usd / Euro
1.4405

Gbp / Usd
1.6990

Gold
$963.00
Brent
$75.25
Expected ranges
Rand / Usd
7.8500-8.0500

Rand / Euro

11.3500-11.5500
Rand / Sterling
13.4000-13.7000
Jpy / Rand
11.80-12.00