Rand recovers losses despite risk-off sentiment
The rand was 1.2% firmer against the dollar on Friday afternoon, as it regained the losses it shed on Thursday. The rand weakened by nearly 3% on Thursday when emerging-market currencies succumbed to the political concerns in the US and Brazil.
Concerns over the ability of US President Donald Trump’s administration to deliver the economic stimulus he promised during his campaign led to a softer dollar. Meanwhile, emerging-market contagion related to Brazilian President Michel Temer is compounding the effects of the growing risk-off sentiment.
Investec economist Kamilla Kaplan said these political developments dampened risk sentiment and weighed on the performance of emerging-market currencies over the course of the week. "The broader economic backdrop remains favourable for emerging-market currencies, with global growth set to lift higher."
At 3.30pm, the rand was at R13.2627 to the dollar from R13.4244, at R14.8413 to the euro from 14.9179, and at R17.2712 to the pound from R17.3954.
The euro was at $1.1189 from $1.1112.