Rand firmer after Friday's price action
The rand was slightly firmer against the major currencies on Monday morning‚ having held onto some modest gains after Friday’s intense price action that followed a mixed US employment report.
Nonfarm payrolls data released in the US showed that 113 000 jobs were created in January‚ much lower than the expected 189 000. The data followed the equally disappointing 74 000 jobs created in December. Meanwhile‚ the US unemployment rate fell to 6.6% last month from 6.7% in December.
"The rand initially traded to around R11.20 to the dollar‚ in double quick time this move was undone and we traded down to R10.9450/$‚ before moving back above the R11 level‚" Nedbank capital wrote in a note.
"A sustained move below R11.00 per dollar would bring some relief‚ but the brief moves below that level of late have been met by some concerted dollar buying interest making them rather short lived‚" the banks said.
At 8.42am‚ the rand was at R11.04 to the dollar from its close of R11.06. Against the euro‚ the rand was at R15.04 from Friday’s close of R15.06 and was at R18.13 against the pound from a close of R18.15.
The euro was at $1.3625 from $1.3628 on Friday.
Most market participants expect the rand weakness to resume this week‚ with increased sociopolitical tensions and strikes in the local platinum belt still under way. Analysts estimate the industry has lost R2-billion in lost production and about R900-million in lost wages since January 23‚ when the strike began. – I-Net Bridge