Rand marginally firmer ahead of rate decision
The markets have partially priced in an interest rate increase, although analysts are split on whether this will take place
The rand was marginally firmer against the dollar on Thursday morning, holding on to gains this week, as markets partially price in an interest rate increase. Analysts are almost evenly split on whether the Reserve Bank will raise rates, amid easing rand volatility and global oil prices, but also significant geopolitical risks. The rand gained on Wednesday, although this was similar to most emerging-market currencies, and analysts said a weaker dollar and inflation data that was slightly lower than expected played a role. Market expectations of an increase also picked up a little after the inflation data was released. Trade is likely to be subdued due to the US Thanksgiving Day holiday. Investec chief economist Annabel Bishop, who expects the Bank to raise rates, said an increase is unlikely to lead to much rand strength, and the outlook for the currency is clouded by US monetary policy tightening. If the US raised interest rates as much as it planned to in 2019, additional rand wea...
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