eBusiness Weekly
JOHANNESBURG – South Africa’s rand firmed in early trade on Thursday, as the dollar faltered after the U.S. Federal Reserve Chairman suggested they may be nearing an end of their three-year rate tightening cycle, boosting interest in riskier assets.
At 0630 GMT, the rand traded at 13.7500 per the dollar, 0.25 percent firmer than its New York close of 13.7850 on Wednesday.
Federal Reserve Chair Jerome Powell said on Wednesday that U.S. policy rates were “just below” neutral, comments that many investors read as signalling the Fed’s three-year tightening cycle is drawing to a close.
“The mighty dollar is not looking all that mighty this morning after the Federal Reserve dealt it a blow last night,” Bianca Botes, treasury manager at Peregrine Treasury Solutions, said in a note.
“A slowdown in the pace of rate hikes by the Fed is great news for emerging markets with foreign debt exposure,” said Botes.
South African-focused investors are waiting for the release of October producer price inflation numbers due at 0930 GMT. – Reuters Africa
