Rand softer ahead of Reserve Bank decision
The central bank is expected to keep rates on hold in its first decision for 2019, even as Brexit uncertainty persists
The rand was marginally softer against major global currencies on Thursday morning, with local focus squarely on the Reserve Bank interest rate announcement at 3pm.
Consensus is for the Bank to keep the repo rate on hold at 6.75%.
The global environment is arguably more supportive of risk assets than it was in November, with the US Federal Reserve no longer assumed to be in a hiking cycle and China pledging to reflate its economy, affording the Bank opportunity to keep rates on hold, at least in the short term, said Rand Merchant Bank analyst Nema Ramkhelawan-Bhana.
At 9.46am the rand was 0.4% weaker at R13.7433/$, 0.3% at R15.6422/€ and 0.21% at R17.67/£. The euro was flat at $1.1382.
The benchmark R186 government bond was bid at 8.82% from 8.77%.
Global focus is on Brexit developments, with UK Prime Minister Theresa May having until Monday to come up with a new Brexit plan, after narrowly surviving a vote of no confidence in her leadership on Wednesday night.
Should she fail to make progress, the opposition Labour party will call for another no-confidence vote, reported Dow Jones Newswires.
Correction: January 17 2019 11.38am
An earlier version of this article stated the Reserve Bank interest rate decision was at 1pm, when it is in fact at 3pm. Business Day regrets the error.