Prospect of US rate cut boosts rand
Focus now shifts to US nonfarm payrolls data due at 2.30pm SA time, with the consensus that employers added 146,000 jobs in September, and the unemployment rate remained steady at 3.70%.
Should the number disappoint, the rand could test R15/$, said TreasuryOne senior dealer Andre Botha in a note, adding that the local currency should be range-bound until this data release.
The rand should benefit from US interest rate cuts, as they make SA’s relatively higher-yielding bonds even more attractive to investors.
According to Bloomberg data, the market is pricing in an 84.2% chance of the Fed cutting rates by 25 basis points on October 30, up from 43.4% a week ago.
Source: businesslive.co.za
