Peregrine Treasury Solutions

22 Aug 18

CPI Hardly Impacts Rand as Dollar Weakens

The rand was somewhat surefooted yesterday after US President Donald Trump’s potshot at Federal Reserve chairperson Jerome Powell over interest rates weighed on the dollar allowing the domestic currency to trade in a range of between R14.26 and R14.46. Meanwhile the inflation figures had little impact on the rand with the consumer price index (CPI) 5.1 percent year on year in July 2018 from 4.6 percent in June, the 16th consecutive month below the SA Reserve Bank’s upper-target level of 6 percent but somewhat higher than market expectations of 5 percent.

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20 Aug 18

Vulnerable Rand Braces for US Fed Minutes

The rand which breached the R15/$ mark last week, remains vulnerable as the US Federal Reserve Bank will release minutes from last week’s meeting. The Fed will also host an economic policy symposium later this week. The local currency opened at R14.68/$ on Monday morning, and strengthened o.85% to R14.52 by 11:02.

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17 Aug 18

Rand Firms to Better than R15/$ but Remains Vulnerable

After briefly hitting a two-year low of R15.02 to the dollar, the rand recovered on Friday afternoon but remained weaker than its overnight close. The rand came under renewed pressure after EFF leader Julius Malema introduced a bill in Parliament proposing that the state become the South African Reserve Bank’s sole shareholder.

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16 Aug 18

Volatile Rand Continues to See-saw Around the R14.50/$-level

The rand continued its substantial see-saw swings against the dollar on Thursday, first firming by 1.6% and then again weakening to trade roughly even by the early afternoon. The rand opened the day’s trade at R14.56/$ and rapidly firmed to R14.32/$ before weakening. And analyst say the period of sharp fluctuations are not over. “We expect large swings in the exchange rate with a wide range of R14.25/$ to R14.69 [On Thursday],” said Bianca Botes of Peregrine Treasury Solutions in a morning note.

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15 Aug 18

Naspers Drags JSE down, Rand in Biggest Decline

THE RAND headed for its biggest drop against the dollar since 2016, according to Bloomberg, buffeted by headwinds including a downbeat assessment of the economy by Moody’s Investors Service and a plunge in the biggest company on the JSE. Moody’s report, “Government of South Africa: Fiscal slippages likely this year, but medium-term targets remain within reach”, found that the pace of South Africa’s fiscal consolidation would be slower than government forecast as weaker than expected economic growth and a rising public sector wage bill acted as fiscal headwinds.

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