JOHANNESBURG. — The rand was firmer yesterday morning after a volatile day on the forex markets on Wednesday.
Standard Bank trader Warrick Butler said that the price action in the forex markets on Wednesday had beggared belief.
“It was astounding to think that — without any news or global risk event — currencies can move up to 4 percent (Turkish lira) in a day on the back of a president-elect talking.
“The problem is that we have never experienced a person like this in charge of what is essentially the most powerful country that is and has ever been in this world,” Butler said.
Ahead of US president-elect Donald Trump’s long-awaited media conference, traders’ attention was focused on what he might say about his policies.
However, analysts said that while his speech was entertaining he failed to elaborate on his planned growth policies. Instead he focused on rebuking the media and intelligence agencies over unverified allegations made against him that showed him in an even more deplorable light.
Trump’s all-out approach did not benefit the dollar in yesterday morning trade; the currency lost ground after gaining ahead of his speech.
The decline in the Turkish lira hit the rand, along with other emerging-market currencies. There are concerns that Turkey’s central bank will not be able to stop the currency’s depreciation. —