South African Rand Trades Rangebound Against USD, EUR, GBP
The South African rand is trading rangebound against crosses including the US dollar (USD), the Euro (EUR) and Sterling (GBP) on Monday as investors monitor developments in the Middle East.
Rising US Treasury yields and a stronger US dollar continue to pressure emerging-market currencies, First National Bank (FNB) said in a brief.
Currently, the rand trades at approximately R16.35 per US dollar, R18.62 per euro, and R21.64 per British pound, the Bank said in its brief.
Uncertainty in the global commodity market appears to be worsening after US President Donald Trump rejected Iran’s peace proposal.
Oil prices surged as concerns grow that the restoration of oil flows through the Strait of Hormuz may be further delayed after President Trump rejected Iran’s seven-day proposal to reopen the strait. Brent crude is trading at approximately $106.88 per barrel over lingering supply risk.
Gold is weaker amid rising inflation concerns, reinforcing expectations of further Fed rate hikes. Traders said Gold is trading at approximately $4,197 per ounce.
A market report revealed that Gold remains in a long-term uptrend, but recent price action suggests the recovery from its earlier correction is struggling to gain traction.
The metal closed the week at $4 285/ounce (oz.), extending a pullback from recent highs and remaining below key resistance levels.
The yellow metal continues to trade beneath its rising 200-day simple moving average, indicating that the anticipated next leg of the advance remains unconfirmed.
The recent weakness has been driven by a combination of higher United States (US) Treasury yields, a relatively resilient US dollar, and expectations that monetary policy will remain restrictive for longer.
Elevated real yields have increased the opportunity cost of holding non-yielding assets such as gold, triggering short-term profit-taking. #South African Rand Trades Rangebound Against USD, EUR, GBP# South African Rand Trades Sideways Ahead of SARB Rate Decision
