International

The dollar lost ground against a basket of its peers, struggling to continue its uptrend, following the Fed’s meeting. The dollar failed to keep afloat and dipped to a low of 92.244 to end the session at 92.373.

The euro staged a recovery on the back of a weaker dollar and was further strengthened by the ECB’s stance to set its inflation target at 2%, implying that interest rates will be kept low for an extended period. The euro rose to a high of $1.1867 and ended the session at $1.1842.

Despite broad-based dollar weakness, the pound fell yesterday. With lingering threat of the Delta variant putting pressure on the cable, and also undermining prospects of economic recovery.  The pound fell to a low of $1.3740 before ending the session at $1.3785.

ZAR

The South African rand showed resistance in yesterday’s session, although it ended the session on the back foot at R14.3317/$, higher than its previous close after reaching a high of R14.4380/$. This was on the back of a stronger dollar.

The local unit remains pressured as the delta variant continues to threaten global sentiments. On the data cards, we are expecting a release of business confidence data locally, and internationally we have GDP estimate and manufacturing output from the U.K.

his 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 dollar remained on the front foot, rallying in yesterday’s session though with reduced momentum in response to the publication of the Fed’s meeting minutes which noted growing concern and uncertainty with regards to its monetary policy.  The dollar index touched a high of 92.845 to end the session at 92.644.

The euro retreated, posting additional losses at the back of reduced risk appetite. As the ECB sets out to announce the results of its revised inflation target, the euro remained under pressure throughout the day.  The euro touched a low of $1.1780 to end the session at $1.1789.

Pound sterling also endured more losses, as safe haven flows favoured the US dollar over the pound and remained a dominant factor throughout intraday trading.  The pound touched a low of $1.3752 and ended the session at $1.3800.

ZAR

The South African rand traded firmer within a range in yesterday’s early session, but lost momentum intraday as investors waited on the side-lines ahead of the Feds minutes, to close the session at R14.3225/$ after reaching a high of R14.4125/$.

We don’t have any local data due to be released today and internationally we are expecting jobless claims data from the US. The local unit is most likely to remain a passenger driven by global factors.

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.