Rand Gains Against Dollar, Euro, Pound as Oil Prices Ease
The South African rand is strengthening against crosses, including the US dollar, British pound, and Euro, as global crude oil prices continue their downtrend.
The local unit trades at R16.49 per dollar as investors assess local municipal election results, uncertainty over the planned AGOA suspension, and ongoing geopolitical tensions, First National Bank (FNB) said in a brief.
Political and trade risks have kept investors cautious, while a softer US dollar and easing expectations for aggressive Fed rate hikes are providing some support.
Against other crosses, the rand is trading at R22.06 per pound and R18.40 per euro, supported by easing geopolitical risk and a surge in yellow metals.
On Friday, it stood at R22.20 per pound and R18.51 per euro. Gains against the euro and pound are smaller than against the dollar, suggesting a softer dollar is also supporting the rand.
Gold has climbed to $4123.19 per ounce as weaker oil prices have eased inflation concerns, though stronger US employment data and rising expectations of a December Fed rate hike have limited gains.
Gold staged a strong recovery last week, rebounding from a weekly low near $3 876 to close at about $4 072/ounce (oz.), a gain of roughly 5.1%.
That lifted the metal back above $3 980, the 50% retracement and former support level, an early sign it is stabilising after its correction from the peak near $5 600.
The yellow metal remains below its 200-day average, so the wider correction has not yet resolved, particularly amid risks of a higher-and-for-longer monetary policy path.
Markets now turn to tomorrow’s US inflation data for clues on the Fed’s next move.
Brent crude traded at $98.37 per barrel, extending last week’s losses as hopes of progress in US-Iran nuclear talks and the reopening of the Strait of Hormuz eased supply concerns. However, optimism was tempered by continued diplomatic hurdles and fresh Houthi attacks in Saudi Arabia. #Rand Gains Against Dollar, Euro, Pound as Oil Prices Ease# Rand Weakens Against Dollar over US-South African Troubled Relations
