Rand on track for week two of gains amid US-China deal hopes
A US official stoked hopes on Thursday that the US and China are closing in on a partial trade deal, to the benefit of risk assets
The rand was firmer against major global currencies on Friday morning, on track for a second-consecutive week of gains, amid rising hope that the US and China are closing in on a trade deal.
White House economic adviser Larry Kudlow said on Thursday the US and China are down to the final steps of agreeing on a “phase one” trade deal, surprising investors, who have spent much of the past week on the receiving end of headlines suggesting the opposite.
The threat of more tariffs is real, on the other hand, said London Capital Group senior market analyst Ipek Ozkardeskaya in a note.
“The US will likely add 15% tariffs on $160bn worth of Chinese imports, if a partial deal is not inked by December 15. With this, there is more clarity on what would happen if the two countries didn’t come to an agreement within a month than what would happen if they did,” She said.
At 8am the rand was 0.15% firmer at R14.7948/$, and had gained 0.14% to R16.3075/€ and 0.2% to R19.0525/£. The euro was flat at $1.1022.
The local currency has gained 0.44% against the greenback so far this week.