While the rand touched the R14.40 level last week, we saw the local currency losing quite a bit of ground on Friday before ending Friday in the high R14.70’s. The reason for this seems to be the fear of a bit of contagion from the political and economic fallout from Turkey, where the Lira has hit record lows against the US dollar in the past week. We will have to be vigilant of any further news out of Turkey as this could impact the rand in the short term. We have also seen that the effect of the US dollar has subsided a little as the EM’s are taking centre stage at the moment.
We have seen the Gold price again knocking on the $1,800 level and is currently trading at $ 1,798 per ounce. This comes on the back of some comments from Jerome Powell as he expects inflation pressures to ease into 2022, and the FED was on track to start tapering. Platinum and Palladium seems to have arrested some of the weakness that we saw in the back end of last week with the two metals trading at $1,044 and $2,035 respectively. Brent Crude is still on the upward track, with the price of Crude well above the $85 per barrel and is trading at $86.11.
The US dollar has slipped a little against the euro and is currently trading at 1.1658. As we have seen in the past trading sessions, the greenback is relatively stable around the 1.1640 level. This week, we have some critical data that could see US dollar activity with the 3rd Quarter Advance GDP and Eurozone Inflation numbers at the forefront of the potential moves. This morning we have seen Asian markets mainly in the green, with the Nikkei in Japan being the only market in the red. We will look at the equity markets as an indicator of market sentiment in general. However, we still believe that for the rand, the sentiment regarding EM’s at the moment is paramount.