International
Having opened the week’s first trading session with the US back after the long weekend, the dollar started off weaker at the open but managed to post slight gains in order to end the day flat against Monday’s close. The dollar index reached a high of 89.940 before ending the session at 89.831.
The Euro initially posted gains yesterday, rushing to a high of $1.2254 in the morning on better than expected data prints in Germany and across the Eurozone. However, the single currency was not able to hold onto these gains and ended the day at its low of $1.2213.
For the last half a month, Pound Sterling has been making swings between $1.4100 and just north of $1.4200. Yesterday morning, the pound pushed hard and reached a new 3-year high at $1.4248. Much like the euro however, the pound could not hold onto its gains and too ended the day near its low at a rates
ZAR
The South African rand ended its multi-session’s winning streak on Tuesday, suffering a minor setback on the day, on the back of disappointing unemployment numbers, with the return of rational power cuts also dimming the lights out of the rand. The local unit dipped to a multi-year low of R13.6737/$, before erasing all its gains, weakening to a high of R13.7962/$, and ultimately ending the session on the back foot at R13.7459/$
Stats SA released the country’s unemployment numbers, printing at 32.6% in the 1st quarter of 2021, rising from 32.5% in the last quarter of 2020.
On the data front, we are flat locally today, and internationally we have Retail Sales data in Germany, amongst others. The local unit will most likely continue to track market-moving events and data on the day.
This communication (“this communication”) has been provided by the corporate and investment banking division of Absa Bank Limited a registered bank in the Republic of South Africa, a subsidiary of Absa Group Limited, with company registration number: 1986/004794/06 and with its registered office at: Absa Towers East, 3rd Floor, 170 Main Street, Absa Towers West, 15 Troye Street, Johannesburg 2001, Republic of South Africa (“Absa”). Absa is regulated by the South African Reserve Bank. Absa has provided this communication for information purposes only and you must not regard this as a prospectus for any security or financial product or transaction. This communication is from an Absa Sales and/or Trading desk and is not a product of the Absa Research department. This communication has not been produced, reviewed or approved by the Absa Research Department, and is not subject to any prohibition on dealing ahead of the dissemination of research. The views in this communication are not a personal recommendation and do not take into account whether any product or transaction is suitable for any particular investor. This message is subject to the terms and conditions at: http://www.absa.co.za/disclaimer. This communication is confidential and no part of it may be reproduced, distributed or transmitted without the prior written permission of Absa.
International
The US dollar index saw a significant pullback yesterday, recouping two session’s worth of losses on the day. The greenback found some reprieve on the back of the Fed’s unwavering support towards economic recovery and their view on subdued policy environment and inflation. The dollar rose to a high of 90.109 before ending the session at 90.109.
The euro opened the session firm on the day, tracking higher in its early activities, although intraday trades, along with the opening of the US session saw a drastic shift in appetite, which saw the single currency relinquishing all its earlier gains on the back of a rising dollar. With dovish remarks from the ECB’s board member also weighing on the pairs moves. The euro retreated to a low of $1.2187 before ending the session at $1.2193.
The pound sterling retreated further on the day, eyeing its latest support levels, on the back of an aggressive dollar on the day, with COVID-19 jitters also keeping the cable subdued. The British pound fell to a low of $1.4113 before ending the session at $1.4121.
ZAR
The rand has been doing a stellar job over the past few sessions, extending gains against the dollar to trade a 27-month best below the R13.80$ threshold as unappealing US returns, weighed by further comments from US Fed officials about the persistence of ultra-easy policy, boosted high-yielder sentiment. The rand was firm at R13.7394/$ on the day and closed out at R13.7492/$
Local PPI data will kick us off on the data front today, although no significant rand movement is expected from the day’s print. We anticipate global factors to influence and drive sentiment.
This communication (“this communication”) has been provided by the corporate and investment banking division of Absa Bank Limited a registered bank in the Republic of South Africa, a subsidiary of Absa Group Limited, with company registration number: 1986/004794/06 and with its registered office at: Absa Towers East, 3rd Floor, 170 Main Street, Absa Towers West, 15 Troye Street, Johannesburg 2001, Republic of South Africa (“Absa”). Absa is regulated by the South African Reserve Bank. Absa has provided this communication for information purposes only and you must not regard this as a prospectus for any security or financial product or transaction. This communication is from an Absa Sales and/or Trading desk and is not a product of the Absa Research department. This communication has not been produced, reviewed or approved by the Absa Research Department, and is not subject to any prohibition on dealing ahead of the dissemination of research. The views in this communication are not a personal recommendation and do not take into account whether any product or transaction is suitable for any particular investor. This message is subject to the terms and conditions at: http://www.absa.co.za/disclaimer. This communication is confidential and no part of it may be reproduced, distributed or transmitted without the prior written permission of Absa. |
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