The Daily Forex Market Report

19 November 2024

 

Good morning

 

It may have slipped from the main headlines but the war between Russia and Ukraine marks a sombre milestone today as it notches up 1000 days of conflict.  Russia invaded Ukraine in February 2022 and since then hundreds of thousands of lives have been lost, millions of Ukrainians have fled and the country has lost a quarter of its population. 

 

These are the mid rates at 5:40 today:

 

USD = R17.92	AUD = R11.69
GBP = R22.75	DXY = 106.14
EUR = R19.01	Brent Crude = $73.42 per barrel

 

Market News

 

• After a difficult week for the Rand last week things have gone rather well for us over the last 24 hours with us opening at R18.12 to the Dollar yesterday morning, strengthening to R18.00 by the end of the day and then registering further gains overnight to open today at R17.92. 
• The Rand has enjoyed two sources of support and is definitely making the most of what seemed to be a very unlikely situation towards the end of last week.  On the local front news that S&P have lifted their projection for SA from stable to positive has been very well received, and this is definitely the primary source of Rand strength.  SA’s economic prospects have been strained for many years but with the elections bringing an encouraging sense of direction plus the absence of load shedding lifting all spirits suddenly we have a path to economic recovery ahead.  With S&P endorsing that path that has been a shot in the arm for the Rand.   
• The following is from Business Day:  “S&P’s decision is a significant vote of confidence in the GNU’s reformist agenda, driven by anticipated political stability and reforms aimed at boosting GDP growth, private investment, and narrowing fiscal deficits,” said TreasuryOne currency strategist Andre Cilliers.. “This unexpected upgrade has positively influenced investor sentiment, contributing to the currency’s recovery. The credit outlook boost may incentivise continued reforms and efforts by the government to solidify gains in governance and infrastructure investments.”
• Long may the positive local headlines continue but the Rand is also clawing back lost ground thanks to a slightly weaker Dollar.  With the Dollar Index still at 106.14 this is still in elevated territory, and further gains for the Rand will be difficult to come by if the index stays in this region, but after hitting a one year high of 107.07 last Thursday the Dollar Index has taken a small backwards step and thus opening the door for Rand gains. 
• Various reasons for the Dollar’s retreat are being thrown about but most probably this is just a bit of profit taking after such an impressive run higher last week.  Some analysts suggest however that the delay in Donald Trump selecting his Treasury Secretary is weighing on the Dollar while others are suggesting that the greenback is taking a breather as the market waits for the all important Nvidia quarterly earnings report tomorrow night.  But whatever the reason the Rand doesn’t really care, just as long as we can move further below R18.00 that is good enough for us. 
• No local market data today.
• Possible USD mid rate trading ranges in the Rand today are R17.80 and R18.10.

 

 

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