The US dollar remained flat in the early hours as the market awaited the Fed’s rate decision. The question on the day was whether the Fed was going to deliver a dovish 25bps rate increment and signal a pivot in the tightening of its monetary policy due to the current state of the banking system. In the latter session, the index extended some losses to 102.425 as the rates market collapsed post the 25bps rate increment from the Fed. The US dollar closed off the session in negative territory at 102.442.

EUR

The euro continued with its prior session’s momentum, edging higher from open as the focus shifted to the Fed’s rate decision amid the fragile banking crisis. The euro saw solid gains in the latter session, extending its gains to an intra-session high of $1.0910 as the US rates pushed lower.  Despite the Fed highlighting that the US banking system is sound and resilient, and they don’t expect to see rate cuts this year, the single unit managed to close off the session significantly above its opening level at $1.0855.

GBP 

• Pound Sterling stepped into positive territory from open as focus shifted to the Fed’s rate decision, while later on the day, key focus turned to the BoE’s rate decision due today. The pound managed to reverse its prior session losses, strengthening to an intra-session high of $1.2324 as the dollar continued with its bearish momentum. Sterling closed off the session in positive territory at $1.2269.

ZAR 

The South African CPI data released yesterday printed an increase to 7% YoY for February from a previous 6.9%, paired with the Q1 Manufacturing Survey’s print to 17, declining by 9pts, signaling the adverse effects of rolling blackouts.   Whilst in the middle of a banking crisis, the Fed increased their interest rates by 25bps.  These headline events saw the rand impressively reclaim its gains and edge lower in the session, strengthening to a low of R18.1550/$, as risk sentiment found a sweet spot, before closing stronger from its opening level at R18.31/$.Local data is mute d today and internationally, we have the Bank of England’s rate decision, US Initial Jobless Claims, and the Eurozone’s Consumer Confidence Flash.  The rand will take direction from these key releases as well as other local and global headlines.

 Expected ranges for the day:

• USDZAR:  R18.00/$ – R18.30/$
• EURUSD:  $1.0830 – $1.0975
• GBPUSD:  $1.2250 – $1.2400