The spectre of a trade war continues to hover over China and the USA – with actions from either party likely to have a direct impact on the rand this week.
According to TreasuryOne analyst, Andre Botha, with a light data-and-event calendar this week, the rand will likely be at the mercy of the tensions between the two major superpowers.
“The rand got a bit of a reprieve on Friday with the US non-farm payroll (NFP) number that came in a lot lower than expected (103,000 vs 188,000),” TreasuryOne said.
“This helped the rand to close around the R12.00 level after it traded near the R12.10 level earlier on Friday. Even with the NFP numbers that disappointed we expect the rand to be still a little wary of the ongoing negative international sentiment.
“The lack of data and events today leads us to believe the rand will trade in very tight ranges with the bias to the rand losing a little ground and trading above R12.00 again in the short term.
“The week ahead we can expect range trading unless we have a definite change in the trade wars stalemate then the rand will get clear direction,” it said.
At 11h00 on Monday (9 April) the rand was trading at these levels against major currencies:
- R12.05 to the dollar
- R17.00 to the pound
- R14.80 to the euro