Rand slips past R12 to the dollar mark


The rand slipped past the psychological R12 to the dollar mark on Friday morning‚ its weakest point in more than two weeks‚ as the dollar held firm against a basket of currencies ahead of the US non-farm payrolls report in the afternoon.

Market attention will be on salary growth to gauge the trajectory of inflation‚ which has been the missing piece of the puzzle in world’s largest economy. Inflation has consistently run below the US Federal Reserve’s 2% target‚ leaving it with little scope to increase interest rates at a faster pace.

The relative strength in the dollar came despite US President Donald Trump threatening to impose more tariffs against China on Thursday. The two largest economies are engaged in a tit-for-tat trade spat‚ but it remains unclear at this stage if the tariff measures will materialise in their original form or are meant to be a negotiating tactic.

The Trump administration was mulling R100bn in additional tariffs against China‚ which it accuses of intellectual property theft.

“The longer this [tariff] impasse drags on‚ the more uncertainty will seep into the market and the greater the knock-on effect will be to emerging-market currencies and other risk-based markets‚” TreasuryOne dealer Andre Botha said. “We have seen the rand break above the R12 to the dollar mark this morning‚ and the feeling is that we can head a little higher if the current sentiment holds.”

At 10am‚ the rand was at R12.0549 to the dollar from R11.9844‚ R14.7401 to the euro from R14.6688 and at R16.8754 to the pound from R16.7819.

The euro was at $1.2227‚ from $1.2240 on Thursday.

By Andries Mahlangu – BusinessLIVE


Please enter your comment!
Please enter your name here