Picture: REUTERS
Picture: REUTERS

The rand was range-bound against major global currencies on Wednesday afternoon, treading water ahead of much-anticipated testimony by US Federal Reserve chair Jerome Powell later in the day.

A less dovish stance is expected following strong employment data from the US, said Treasury Corporate Solutions treasury partner Bianca Botes in a note, adding that if this occurs the rand could set its sights on R14.30/$.

At 2pm the rand was flat at R14.1831/$, R15.9035/€ and R17.6847/£. The euro was flat at $1.1219.

A move to R14.30/$ would equate to a weakening of about 0.85%.

Globally, investors were holding their breath before Powell’s testimony, which continues on Thursday.

Given how financial markets remain extremely sensitive to rate-cut speculation, there was a lot at stake on Wednesday, with Powell handed the mammoth task of pleasing investors without overpromising, said FXTM research analyst Lukman Otunuga in a note.

Should Powell sound less dovish than expected during his testimony, the dollar index could push higher with the 97.80-point level being a possibility. The index, which measures the dollar against a basket of six major global currencies, was flat at 97.489 on Wednesday afternoon. A rising index indicates a generally stronger dollar.