Fears of weak rand roller-coaster mount

THE RAND weakened yesterday after finishing the past week on a high.

Dynamic head market analyst James Paynter said that while the rand ended the past week on a high note, its performance from the beginning of this week had been rather abysmal, with the dollar steadily pushing higher. “After opening below R13.40, we saw the rand just keep barreling onwards toward R14 against the dollar,” said Paynter.

Paynter said it appeared South Africa was going to be in for another roller-coaster of a week.He said with global markets rather jittery and trade wars likely to simmer on, the volatility should not be expected to end any time soon.

At 5pm the domestic currency was bid 11c weaker than Friday’s same time bid at R13.57 a dollar. Against the pound sterling the rand was 14 softer at R17.88 and to the euro the currencey eased 19c to R15.88.

TreasuryONE dealer Andre Botha said the outcomes of Turkish elections could spur further recovery for emerging markets (EM) as President Erdogan claiming victory we have saw the country’s Lira appreciate 3 percent against the US dollar.

“This could be beneficial to the rand as we usually expect some contagion effect to filter through the market and lead to some rand strength.

Botha warned that it remained to be seen Erdogan would pursue his stance on having more control of the monetary policy in Turkey.

Should this be the case, Botha said we could see the current sentiment shift to EM currencies turn around swiftly.

The day’s biggest gainers were Hosken Consolidated Investment that climbed by 4.12 percent to R135.56 followed by Vivo Energy as it increased by 3.17 percent to R26 with Santam appreciating by 3.09 to R296.

Dis-Chem lifted by 2.09 percent to R26.87 and Telkom grew by 1.36 percent to R49.16.

The losers included Exxaro which plummeted by 5.51 percent to R117.32 followed by Kumba Iron Ore which shrank by 5.33 percent to R286, RCL Foods declined by 4.29 to R17.40 while Barloworld sank by 3.98 percent to R128.38 and Impala Platinum fell by 3.88 percent to R20.30.