Rand trades flat as the dollar strengthens on a near 16-month high

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Rand trades flat as the dollar strengthens on a near 16-month high
Rand trades flat as the dollar strengthens on a near 16-month high

Africa-Press – South-Africa. The rand was flat on Thursday, as the dollar traded near a 16-month high after investors bet that the US Federal Reserve will tighten monetary policy faster than its peers.

At 6.30am GMT, the rand traded at 15.8900 against the dollar, not far from its previous close of 15.8925.

Fed minutes showed on Wednesday that various policymakers at the US central bank would be open to speeding up the taper of their bond-buying programme and raising interest rates more quickly if high inflation held.

Dollar moves have been one of the main drivers for the rand in recent days, along with emerging market contagion linked to a meltdown in the Turkish lira.

Around 9.30am GMT on Thursday, local investors will study domestic producer inflation data for more information about price pressures in Africa’s most industrialised economy.

Last week, the South African Reserve Bank raised rates for the first time in three years, in response to broadening inflationary risks, but that has done little to buttress the rand which is down roughly 4 percent against the dollar this month.

The government’s benchmark 2030 bond was flat early on Thursday, with the yield at 9.755 percent.

REUTERS

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