Rand flat, with focus on Ukraine crisis

Stocks rise slightly.
Image: Bloomberg

The rand traded lower early on Thursday, shedding gains from the previous session, with traders turning cautious that Russia’s invasion of Ukraine could dampen economic growth.

However, by 12:20 the rand traded at R15.33 against the dollar, around 0.05% weaker than its previous close. The currency had touched R15.28 on Wednesday as strong commodity prices offered support.

Rand vs US dollar over 7 days

“With the war still tentatively poised, I can’t see a reason to be overly bullish risky assets just yet, despite the commodity play,” Warrick Butler, chief trader at Standard Bank, wrote in a note.

“There is still too much uncertainty although at least we now know the cards the Fed is holding in their hands.”

US Federal Reserve Chair Jerome Powell said on Wednesday the central bank would begin “carefully” raising interest rates this month, but was ready to move more aggressively if needed – more or less the scenario traders have priced in.

The local bourse was trading in the green on Thursday. The JSE All Share was 0.45% higher at 77 883.57 points, and the Top 40 was 0.49% at 71 406.28 points at 12:24.

JSE Alsi and Top 40 on Thursday

In fixed income, the yield on the benchmark 2030 government bond was up 2.5 basis points to 9.57%, reflecting weaker prices.

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