MARKETS WRAP

SOUTH Africa’s rand firmed in afternoon trade yesterday as the US and China sought to ease trade war tensions while investors also looked to a slew of domestic economic data later in the week for clues on the health of the economy.

With global markets increasingly twitchy over developments in the bitter trade war between the world’s two largest economies, Beijing on yesterday called for calm and US President Donald Trump predicted a deal between the two sides.

In the afternoon, the rand was 0.67 percent firmer at R15.1975 against the dollar.

“The rand tested the R15.45 level this morning during the major sell-off, but markets seemed to calm down later as the market took a breather after conciliatory remarks from both the US and China while fresh US-Japan trade optimism also helped ease some nerves,” TreasuryONE senior currency dealer Andre Botha said in a note.

The rand has suffered this month, sliding more than 6 percent as local pressures linked to the growing chance of a credit downgrade to junk by Moody’s, and uncertainty offshore, have stalled any long bets on the currency.

The SA Revenue Service will publish July trade balance numbers on Friday. “While a trade surplus in July will be supportive of economic growth, all eyes will be on the import and export figures. Any signs of global trade tensions reducing demand for South African exports will be negative for the rand,” said Lukman Otunuga, a senior research analyst at FXTM. | Reuters