Yesterday’s national holiday limited Rand fluctuations, and as the local market opened this morning the commodity-driven currency was fairly static.
At the current exchange rate 1 US Dollar will purchase 10.0025 South African Rand as of 11:15 GMT
The Rand weakened slightly against the US Dollar
The Rand weakened slightly against the US Dollar, to trade in the region of 10.0800, as industry experts looked ahead to this week’s most influential data releases.
As one locally based industry expert observed: ‘From an international perspective, the most important event is the media conference after the US Federal Open Market Committee meeting on Wednesday evening’.
But on top of the Rand volatility which may be inspired by developments in the US, further movement could be caused by several pieces of home-grown data, including South African current account deficit/ consumer inflation figures and the Reserve Bank’s June Quarterly Bulletin.
Already today domestic jobs data has shown that despite the number of employees in sectors like manufacturing and mining dipping, overall employment was up in the first three months of this year.
The Rand softened to 10.0140 against the US Dollar
In Q1 of 2013 the South African economy added roughly 7,000 non-agricultural jobs, taking the number of employed people in the nation to 8.463 million.
However, the mining industry lost 9,000 positions year-on-year and 1,000 employees on a quarterly basis.
The number of people employed in the manufacturing sector declined by 10,000 year-on-year and 4,000 from the fourth quarter of 2012 to the first quarter of 2013.
Despite the gain in employment the Rand fluctuated before softening to 10.0140 against the US Dollar
A separate report also showed that gross earnings fell by 3.9 per cent quarter-on-quarter, although incomes were still up 8.1 per cent on the year.
The expectation that tomorrow’s current account data will show that South Africa’s shortfall expanded in the first quarter of the year is weighing on the commodity-driven currency.
According to currency strategist John Cairns: ‘A bigger-than-expected number would clearly rattle [the Rand] given the fears over a slowdown of flows to emerging markets.’
Economists are expecting tomorrow’s figures to reveal that the deficit on the current account widened to 6.9 per cent of GDP in the first three months of the year from the 6.5 per cent recorded in the fourth quarter of 2012.
Additional movement in the USD/ZAR paring could be triggered by today’s US inflation data.
Current South African (ZAR) Exchange Rates:
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The US Dollar/South African Rand Exchange Rate is currently in the region of: 10.0025 >
The Pound Sterling/South African Rand Exchange Rate is currently in the region of: 15.6853 >
The Euro/South African Rand Exchange Rate is currently in the region of: 13.3626 >
The Australian Dollar/South African Rand Exchange Rate is currently in the region of: 9.4827 <
The New Zealand Dollar/South African Rand Exchange Rate is currently in the region of 7.9666 <
The Canadian Dollar/South African Rand Exchange Rate is currently trading in the region of 9.7963 >
(Correct as of 11:15 GMT)
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