After a steady session in the early morning, the dollar index ended the week on a positive note as risk aversion continued to erode the market on the back of market jitters surrounding the banking crisis. The dollar index ended the week at 103.116, having reached a high of 103.357 on the day.
The euro traded lower for most of the day on Friday, weighed down by a stronger dollar environment. The shared currency was further weighed down by a drop in banking stocks in the Eurozone, despite an impressive positive PMI 10-month high print of 54.10 in March. The euro ended the session at $1.0760, down from its previous session, and reached a low of $.1.0717 on the day.
The pound reversed course from its previous session and fell into negative territory, succumbing to pressure from a stronger dollar. The positive PMI release of 52.2, which indicated an overall improvement in the UK economy, did little to change direction for the pound. As a result, the pound ended the session at $1.2228 to close the session.
The local unit closed the week on a sombre note, weighed by broad based dollar strength and sapped risk-on sentiment as concerns of the stability of the banking system continues to flood global markets, with the latest plunge in European banking shares heightening fears. The rand weakened to a high of R18.2850/$ intraday and closed off Friday’s session in the red at R18.1575/$.
We kick off the week with no local data prints and International data releases from Germany, UK, Eurozone, and the US on the cards. The rand will continue to track further developments on the banking crisis while monitoring changes in risk sentiment.
Expected ranges for the day:
- USDZAR: R18.1000/$ – R18.4000/$
- EURUSD: $1.0750 – $1.0830
- GBPUSD: $1.2220 – $1.2300