Rand at four-month high on hopes of US-China trade deal
President Donald Trump indicated that the US and China were close to a ‘big’ trade deal, with reports suggesting an announcement later
The rand lifted to a four-month high against the dollar on Friday morning, amid a risk-on tone on global markets due to US-China trade war optimism.
US President Donald Trump tweeted that both the US and China wanted a deal, with reports citing multiple officials in saying an announcement is due later. This has raise hopes that new tariffs, due to kick in on Sunday, will be avoided.
The rand was mixed, however, as sterling rose due to a decisive Conservative Party victory in the UK national elections.
The victory had created certainty for Brexit, though the trade news was even more positive, “indicating the beginning of the end of the trade tensions that have dominated global discourse for two years,” said Rand Merchant Bank analyst Siobhan Redford.
At 10.15am the rand was 0.42% firmer at R14.433/$, its best level since August 2. The local currency was flat at R16.1333/€, but had weakened 1.43% to R19.3656/£.