Rand healthier after ‘flash crash’ shock treatment
The JSE is likely to follow Asian markets higher on Monday, although its gains may be dampened by the local currency’s recovery
At the weekend, the rand strengthened back under R14/$, R16/€ and R18/£ — a dramatic recovery from Wednesday night’s “flash crash” in which the currency spiked at R14.70/$, R16.65/€ and R18.40/£. The rand reached R13.91/$, R15.88/€, and R17.69/£, taking it to levels last seen a month ago.
The currency was holding on to most of its weekend gains on Monday morning, trading at R13.92/$, R15.91/€ and R17.75/£ at 6.30am. Data released by the Tokyo Financial Exchange gave some clues to what caused the flash crash, which caused not only the rand, but also the Turkish lira and Australian and New Zealand dollars to spike. “A flood of orders to sell Australia’s dollar and the lira against the yen overwhelmed market makers on a day when Japan was shut and liquidity was thin,” Bloomberg reported. “Individual investors cut their net lira long positions by 42,743 contracts, the most since August, according to data from the Tokyo Financial Exchange. The contracts were worth 427-million lira ...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.