The rand edged slightly stronger against the dollar in late trade on Wednesday in the wake of Statistics SA figures‚ which showed an inflation spike in December.
As expected‚ consumer inflation had risen from 4.8% in November to 5.2% in December‚ year on year‚ Statistics SA’s data showed on Wednesday.
At 3.36pm the rand was at R16.7469 against the dollar from R16.7847 previously. It had weakened to R16.96/$ in early morning trade.
Against the euro‚ the rand was at R18.2697 from R18.3070 previously. It was at R23.7291 against the pound from R23.7628.
The euro was at $1.0910 from $1.0907 previously.
Meanwhile‚ local retail sales rose much more than expected in November compared with a year ago‚ suggesting that while consumer spending was slowing‚ it had not collapsed. Sales increased 3.9% year on year in November after rising a slightly revised 3.4% (3.3%) in October‚ Statistics SA data showed on Wednesday.
In late trade‚ market participants were awaiting US inflation figures for December due out on Wednesday.
TreasuryOne chief currency trade Wichard Cilliers said the most significant risk was the US inflation figure‚ as this would have a definite influence on the mood heading into the US Federal Reserve rate decision meeting next week.
The figure had a good chance of disappointing as a stronger dollar and continually slumping oil price should fail to spark an improvement in inflation‚ Mr Cilliers said.
A poor number would halt a hawkish US Fed and cast doubt in investors’ minds on whether the Federal Open Market Committee (FOMC) could justify four interest rate increases this year‚ he said.
TMG Digital/BDlive
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