After showing signs of strength yesterday, the rand has “slipped against the dollar,” reports Fin24
. Yesterday the rand traded to a “session high of R10.93”. But by early this morning, it was back over R11/$.
At time of writing, the rand had weakened further. It was trading at 11.11 to the dollar, 18.48 to the pound and 15.13 to the euro.
The dollar “gained across a basket of international currencies,” says BDLive
. This as new head of the US Federal Reserve (Fed), Janet Yellen, was due to appear “before the Senate banking committee last night”. But because of snow, organisers postponed the meeting.
Absa Capital noted earlier today that if Ms Yellen’s comments are “relatively more dovish compared with her remarks on Tuesday” the rand could weaken, reports I-Net Bridge
On Tuesday evening, Ms Yellen said that the Fed will continue tapering its stimulus programme
. She also indicated that interest rates would remain low.
A number of issues are troubling investors
Later today, President Jacob Zuma will conduct his last Nation address “before elections on May 7,” notes Fin24
. This as the country is dealing with a crippling strike affecting platinum producers
and “protests in townships against poor government services”. Not to mention clashes between the ANC and Democratic Alliance supporters yesterday.
Analysts at Rand Merchant Bank said that overseas “investors are already concerned about strike action and socio-economic uncertainty,” reports IOL
. And clashes between “the DA and ANC supporters in Johannesburg yesterday couldn’t have inspired confidence in foreign investors”.
Important mining data is also due out today, adds BDLive
So the rand is continuing to struggle. And with pressure mounting on the currency as factors weigh, it’s not looking good in the near term.