Rand weakens‚ eyes US fiscal cliff
The rand weakened on Monday afternoon as traders eyed the small possibility of the US going over the fiscal cliff.
“The fiscal cliff in the US is still the biggest issue for the rand. The markets are feeling the irritation of it in the short term. However‚ we expect the cliff to be avoided by the end of the year. The ANC conference together with the remote possibility of the cliff happening has been negative on the local currency‚” said Mark Kalkwarf‚ a senior portfolio manager from the Iquad Group.
At 3.04pm‚ the rand was bid at R8.6936 to the US dollar from Friday’s close of R8.6708. The local currency was bid at R11.2374 to the euro from its previous close of R11.1804 and at R13.9547 against sterling from R13.8357 before.
The euro was bid at $1.2929 from Friday’s close of $1.2907.
“Foreigners are buying into our bonds and stock market‚ due to a risk-on scenario as it looks as though Greece and Spain are going to be sorted out. This has given the market liquidity. The rand often does very well in December‚” Kalkwarf said. - I-Net Bridge