Rand a bit stronger on global sentiment
Investors seemed keen on riskier assets
The rand was a little stronger yesterday morning‚ taking its lead from world markets‚ which were broadly positive.
Investors appeared eager to dip into riskier assets‚ after North Korea held off on provoking the international community at the weekend‚ when it marked the 69th anniversary of its founding.
Pyongyang has previously used the occasion to demonstrate its military might‚ which would have increased tension on the Korean peninsula. Perceived traditional safe-haven plays were under some pressure, while risky assets, like equities, found favour from Asia to Europe.
The rand is sensitive to changes in global sentiment‚ which shapes bond and equity flows. While the rand was slightly better in early trade‚ it was still weaker compared with intraday levels on Friday‚ when the dollar staged a strong comeback.
“We start the week with mixed influences. Risk appetite is high, given Hurricane Irma’s changed path and the surprising lack of any belligerence from North Korea‚” Rand Merchant Bank currency strategist John Cairns said.
On the other hand‚ the rand could come under pressure from a stronger dollar. With no big local economic data releases scheduled‚ local markets will probably take direction from offshore.
At 9.47am‚ the rand was at R12.9259 to the dollar from R12.9651; at R15.5286 to the euro from R15.5830; and at R17.0542 to the pound from R17.0964. –