Rand extends rally as Donald Trump’s comments hit dollar
Standard Bank trader Warrick Butler says risky assets managed to withstand the meltdown in global equities, which is ‘quite extraordinary’
The rand was stronger on Friday morning, which, along with a slightly weaker oil price, helped to allay the fear of another fuel price increase in the near term. Brent crude was trading at $81 a barrel on Friday morning, down from its recent four-year high. The relative strength in the local currency came as US President Donald Trump took the unusual step of criticising the Federal Reserve for raising interest rates. Trump’s comments took the wind out of dollar’s sails, but the rand benefited in the process. Global equity markets also stabilised in early trade, after a sharp sell-off over the past two days, boding well for the rand, which tends to do well when market participants feel confident about buying risky assets. “It is not often that you see a meltdown in global equities without the same corresponding move in risky assets and yet this is exactly what we have seen over the past two days. Quite extraordinary,” said Warrick Butler, a trader at Standard Bank. The rand and local...
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