Following a positive start to the day, the US dollar was seen giving up its earlier gains on the back of poor Industrial production data, ending the session slightly flat with downside pressure. Anticipations that the FED will raise interest rates ahead of the scheduled time dominated the session. Market participants are also of the opinion that a rise in interest rates will not only be a decision taken by the FED, but will most likely be a step most central banks globally take to subdue soaring inflation as a result of stimulus measures introduced. The dollar index reached a high of 94.171 and closed at 93.953.
The euro initially retreated at the start of the American session as the dollar edged higher but managed to find its footing, moderately retracing its earlier losses to finally end the session on the upside. The euro touched a low of $1.1570 and closed at $1.1609.
Momentum was on the downside for the pound in yesterday’s session, touching a low of $1.3707 as it came under pressure, struggling to take advantage of a slightly fragile dollar. The pound remained relatively vulnerable throughout intraday trading to finally close at $1.3725.
The South African rand opened on the back foot on Monday, as the softer than expected Chinese economic data saw emerging market assets lagging across board. Although we saw the local unit putting up a good fight during its late trades, recovering most of its earlier losses, as the dollar lost its momentum. The rand closed at R14.6816/$, after reaching a high of R14.8000/$ intraday.
Locally, no data releases are expected for the day. Internationally, we can expect various economic data from the U.S. and COVID19 data from the Eurozone. The rand will most likely be moved by global trends today.
Expected ranges for the day:
- USDZAR: R 14.5000/$ – R14.7000/$
- EURUSD: $ 1.1600 – 1.1700
- GBPUSD: $ 1.3720 – 1.3790
Expected ranges for the day:
- USDZAR: R 14.5500/$ – R14.7500/$
- EURUSD: $ 1.1560 – 1.1610
- GBPUSD: $ 1.3690 – 1.3750
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