Rand unmoved as fear of trade war dragging on weighs on risk assets

The rand was subdued on Wednesday morning as fears that the US-China trade war may spill into 2020 curbed investor appetite for riskier assets.

US President Donald Trump said that a trade deal could be completed only after the US presidential election in 2020, escalating concern about the effect that would have on the global economy.

At 10.10am, the rand was flat at R14.6407/$ after closing at R14.65/$ on Tuesday. It was little changed at R16.2188/€ while it weakened 0.23% to R19.0644/£. The euro was flat at $1.1078.

The R2030 government bond was slightly stronger, with the yield rising 1.5 basis points to 9.235%. Bond yields move inversely to bond prices.

“The disappointment of yesterday’s [GDP] data will linger and is likely to be expressed in further back end underperformance. We only have the Standard Bank PMI on the local data front so global risk conditions will play a part in the days direction,” Sasfin fixed-income trader Alvin Chawasema said.

The Standard Bank purchasing managers’ index fell to 48.6 points in November from 49.4 in the previous month.

Gold was up 0.43% to $1,483.39/oz and 0.42% to $913.15. Brent crude added 0.2% to $61.12  a barrel.

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Source: businesslive.co.za