“The weak US ISM manufacturing report yesterday and Trump’s announcement of tariffs on metal imports from Brazil and Argentina have seen a risk-off move overnight. The US DXY Dollar index has fallen to 97.917 with the Dollar having slipped to 1.1075 against the Euro and 1.2940 against the Pound.
There have been some headwinds on the trade deal front as well as China threatened to blacklist US companies in retaliation to the US Hong Kong bill passed last week. The manufacturing report showed a worse than expected factory activity contraction at 48.1 against a forecasted 49.2.
The Rand surprisingly firmed sharply and is quoted at 14.5475 this morning, the best performing EM currency by some margin. We have our Q3 GDP number out today which could have an impact on Rand. Economists are forecasting a 0.4% YoY number and a 0.1% MoM number.
Wall Street closed lower yesterday with the S&P down 0.86%, the Nasdaq down 1.12% and the Dow down 0.96%. Asian stocks are also in the red this morning as the risk-off mood bites. Gold is a touch higher at $1 460.70 while Platinum and Palladium are up at $899.80 and $1 855.00 respectively.”
By Andre Botha, Senior Currency Dealer