adminJOHANNESBURG — The rand continued to post strong gains against major currencies in midday trade on Friday, buoyed by disappointing US data which took its toll on the dollar, driving up commodity prices. US economic growth for the first quarter disappointed, dealing a blow to expectations of a near-term hike in interest rates there.
US gross domestic product grew at an annual pace of 0.5 percent in the three months to March, against market expectations of 0.7 percent.
The poor US data was a double whammy for the greenback, which was still reeling from the Bank of Japan bucking expectations by not expanding monetary stimulus on Thursday, which boosted the yen.
This, a day after the US Federal Reserve signalled it was in no hurry to raise interest rates.
At 11.45am‚ the rand was trading at R14.2112 to the dollar from R14.2883 at Thursday’s close. It was at R16.1770 against the euro from R16.2197 previously‚ and at R20.7201 against the pound from R20.8714 previously.
The euro was at $1.1384 from $1.1353. “The rand rally has resumed, but is not at full speed yet. The rand has dropped from Wednesday’s high of R14.60/$ to trade down to R14.26 this morning, within sight of the R14.16 key support line,” said John Cairns of RMB Global Markets. – Sapa
Online Reporter