Rand edges lower ahead as focus turns to local inflation and the Fed
The rand edged lower on Tuesday morning, but remained within its recent trading band, ahead of key data releases and events this week. Statistics SA will set the ball rolling, with the release of consumer inflation, which the Reserve Bank closely monitors to decide on interest rates. Economists expect headline inflation to have slowed to an annual rate of 4.7% in November, from 4.8% in October. On Wednesday, the US Federal Reserve is expected to raise interest rates by at least 25 basis points, bringing the number of rate increases for the year to three. But markets are likely to be pay more attention to the Fed’s future policy moves than the actual decision on rates, which has largely been discounted. The yield on the benchmark US 10-year note has been trading sideways for some weeks amid the uncertainty on how the Fed will approach its policy in 2018. The rand and other emerging-market currencies are sensitive to rate increases in the US, as they tend to affect the flow of funds. ...
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