Following a soft open on Friday, the US dollar tracked lower for the better part of the session, with thin liquidity dominating activity. Although the dollar managed to find some reprieve during late trades, retracing its earlier losses to trade the last day of the year slightly flat. Overall, the USD dollar ended the year stronger against its peers, with the global economic rebound, and prolonged inflationary trade lending support. The dollar index dipped to a low of 95.570, before consolidating to the top side, to end the session slightly flat at 95.968.
The euro ticked higher on Friday, recouping the previous day’s losses on the back of a softer dollar on the day. The single currency has been stuck in a wide range for almost 25 days, consistently trading sideways. Low liquidity and a lack of market-moving events, kept the single currency constrained, leading to year-end. The euro rose to a high of $1.1385 before ending the session at $1.1377. On an overall basis, the euro had a poor performing year.
The pound sterling also lined up to take advantage of a struggling dollar on the day, edging higher for a 3rd consecutive session on Friday. Although the pound traded the last day of the year stronger, on an overall basis it ended the year on the back foot against the dollar. The cable rose to a high of $1.355 on Friday, before ending the session at $1.3524.
A startling end to the year for the beloved currency, as the stars did not align in the rand’s favour in Friday’s session that came with muted trading activities with most market participants on holiday. The local unit was seen closing off the year softer despite easing of Omicron fears and local lockdown restrictions. The rand closed the session weaker from its previous close at R15.9450/$ after reaching a low of R15.8750/$.
We are thin in the way of data today, on both the local and international front. The rand is mostly likely to remain in the woods should the dollar continue to reign.
Expected ranges for the day:
- USDZAR: R 15.8500/$ – R16.0500/$
- EURUSD: $ 1.1310– $1.1385
- GBPUSD: $ 1.3465 – $1.3545