The South African Rand strengthened against the US Dollar, breaking through the key level R10 to the Dollar in Thursdays late morning trade before retreating ahead of the release of the latest US retail sales data.
The cause for the rise has confused traders who are claiming that there was no specific reason for the rise, just as there was no real reason for the currencies move into weaker territory on Wednesday evening.
“There’s no one specific reason for the move‚ but one gets the feeling that it is moving back into ranges after the big moves of the past few weeks‚” said a local currencies trader.
In early morning trading the Rand zigzagged as investors refrained from making any aggressive bets over the ongoing uncertainty regarding the US Federal Reserve’s bond buying programme.
“One gets the sense that market players are still skittish with the lingering uncertainty of another Rand blow-out to put on trades that scream value,” Rand Merchant Bank said in note.
One reason for the Rand’s recovery is that the selloff of emerging market debts has eased and foreign investors returned to buying South African debt. The first buying of debt in five days returned late on Wednesday as R2billion of debt was purchased.
RMB analysts said; “Other emerging markets are showing a similar recovery to the Rand in terms of yields, and sovereign risk measures are slightly lower. This may simply be a pause in the trend rather than a turnaround but for now it brings some much needed breathing space.”
Current South African (ZAR) Exchange Rates
The US Dollar/South African Rand Exchange Rate is currently in the region of: 9.9880
The Pound Sterling/South African Rand Exchange Rate is currently in the region of: 15.4810
The Euro/South African Rand Exchange Rate is currently in the region of: 13.1711
The Australian Dollar/South African Rand Exchange Rate is currently in the region of: 9.4559
The New Zealand Dollar/South African Rand Exchange Rate is currently in the region of 7.9082
The Canadian Dollar/South African Rand Exchange Rate is currently trading in the region of 9.7233
(Correct as of 12:10pm GMT)
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