Rand softer as spotlight remains on Brexit

The rand was mildly softer against major global currencies on Monday morning, digesting mixed news out of Asia, although market focus remains on Brexit.

UK Prime Minister Theresa May is expected to unveil a revised Brexit deal later in the day, after her draft plan was overwhelmingly rejected last week. May would then have eight days to rally support behind the plan or face the prospects of a hard Brexit or the need to ask for a delay of the UK’s departure from the EU.

News from Asia was mixed, with reports suggesting that China had developed a plan to eliminate its trade deficit with the US.

The US-trade war has weighed on Chinese economic performance, with data showing earlier that GDP growth fell to a 28-year low in 2018.

At 9.30am the rand was down 0.1% at R13.8566/$, 0.5% at R15.7739/€ and 0.09% at R17.8423/£. The euro was 0.2% weaker at $1.1384.

The bid on the benchmark R186 government bond was at 8.94% from 8.88%.

In the absence of fresh catalysts, the rand should be range-bound for most of Monday, said Standard Bank currency trader Warrick Butler.

Support for the rand in January, when money had flowed into emerging markets, may have been overdone, he said, as had rand resilience last week.

[email protected]