The rand stumbled on Tuesday as a strong dollar dwarfed the impact of a better-than-expected GDP print, according to NKC Research.
The greenback advanced on the back of higher US Treasury yields, with trading volumes climbing as the US returned from a long weekend. The local economic calendar was dominated by the Q2 GDP print, which delivered a positive surprise as six industries managed to post positive growth.
The economy expanded by 1.2 percent q-o-q in Q2 2021 from a revised 1 percent q-o-q in Q1 (trimmed from an earlier estimate of 1.1% q-o-q), comfortably beating market expectations for an expansion of 0.7% q-o-q.
At close of local trade, the rand weakened by 0.53% to end at R14.31/$, after trading in range of R14.23/$ – R14.35/$. ZAR traded flat overnight. Expected range today R14.10/$ – R14.40/$.
Local bourse overcomes losing streak
The JSE All Share (+0.39%) ended higher yesterday, with increases in technology (+1.87 percent) and industrials (+0.91 percent) offsetting losses in financials (-0.42 percent) and telecommunication (-1.16 percent) stocks. Market heavyweight Naspers (+1.78 percent) rose as technology stock in Asia increased. In the overall emerging market sphere, the MSCI Emerging Market Index (+0.1%) traded higher.
Brent crude oil
The Brent oil price fell yesterday, as Saudi Arabia’s price cut to Asia crude contracts raised fears over a slowdown in demand. The fall in prices was countered by positive economic data from China and the continued outage in the US following Hurricane Ida. At the close of local trade, benchmark Brent crude futures fell by 1.68 percent ending at $71.6pb. Crude prices traded higher during Asian trade this morning.
BUSINESS REPORT ONLINE