Rand firms following upbeat local data
SA recorded a trade surplus of R17.1bn in the final month of 2018, while PPI was better than expected
The rand added to the 30c gain it made overnight against the dollar on Thursday afternoon, bolstered by upbeat local data.
SA imports fell at a faster pace than its exports in the final month of 2018, with the country’s trade account surplus of R17.1bn in that month almost twice that of market expectations.
Earlier, farm and factory gate inflation, as measured by the annual change in the producer price index (PPI), decelerated to 5.2% in December from November’s 6.8%, beating market forecasts of 5.8%.
December’s trade surplus was attributable to exports of R102.75bn and imports of R85.58bn, data from Sars showed on Thursday. The Bloomberg consensus had been for a surplus of R9bn.
Exports decreased 13.4% in December from November, while imports fell 25.8% month-on-month.
Trade numbers are notoriously volatile, with analysts saying the overall trend is more important. A trade surplus eases pressure on the rand and SA’s current account.
At 2.10pm, the rand was 0.21% firmer at R13.286/$, 0.14% stronger at R15.2629/€, while remaining flat at R17.4621/£. The euro was flat at $1.1489.
The rand was adding to gains made overnight after the US Federal Reserve delivered a dovish monetary policy message, with the Fed now penciling only one interest-rate increase in 2019, having previously given forward guidance of two.
This brought the local currency to a seven-month high against the dollar, with the rand’s 7.45% appreciation making it the best performing currency among its emerging-market peers.