Rand trades weaker overnight
The South African rand oscillated in anticipation of the US FOMC meeting, which was widely anticipated to result in a rate cut, while on the local front traders awaited today’s repo rate decision against a backdrop of a weakening fiscal position, downside risk to merchandise trade and volatile geopolitical and global trade outlook according to NKC Research.
Our forecast concurs with the consensus for a Sarb decision to maintain the repo rate at 6.5 percent. On the local data front, the August inflation release outpaced expectations, further cementing expectations for a hold, although it remains comfortably at the lower end of the target range of between 3 percent and 6 percent. At the close of local trade, the rand quoted 0.3 percent stronger at R14.64/$, after trading in range of R14.61/$ – R14.70/$. The rand traded weaker overnight after the Fed cut US interest rates by 25 bps. Expected range today R14.60/$ – R14.90/$.
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