Daily Currency update
South African Rand
The Rand firmed slightly against the dollar in early Wednesday trading after data showed foreign exchange reserves rose in July. The Rand is expected to be impacted by this afternoon’s mining and manufacturing production data.
The Pound climbed to a seven-week high against the US Dollar following yesterday’s Bank of England inflation report. Against the Euro, Sterling is close to a fresh monthly high. The currency’s strength comes from comments made by Bank Governor Mark Carney who raised the UK’s growth forecasts and pledged to keep the bank’s monetary policy accommodative until the unemployment rate falls to 7%.
The ‘Greenback’ is set to make a rally after it fell to its lowest-level since June and as traders position themselves for a stronger Dollar. The currency’s decline has been branded as too quick and that its value is too weak. The Dollar could make gains later in the session if today’s jobless claims data continues to show signs of improvement. Economists however are expecting the number of claims to have risen in July.
The Euro is trading at a seven-week high against the US Dollar after data out of Germany beat economist forecasts by showing that exports outpaced imports. The nation’s trade surplus expanded to €16.9 billion in June, more than the €15 billion expected by economists.
The positive data adds to signs that the Eurozone economy is strengthening.
The ‘Aussie’ hit a fresh monthly high against the US Dollar after data showed that imports in China, Australia’s biggest trading partner, increased more-than-expected in July. The currency also found support from traders paring their bets that the Central Bank will lower interest rates again before the end of the year. The better-than-expected Chinese trade data overshadowed weaker Australian employment figures.
New Zealand Dollar
The ‘Kiwi’ weakened against its Australian relation after Chinese trade data beat expectations. Against the US Dollar and several other peers the currency made gains after the scare over dairy products was reduced.
The ‘Loonie’ fell to its lowest-level in nearly four-weeks due to a fourth day of declines in commodity prices and as stocks sank on increased speculation that the US Federal Reserve may slow its monetary stimulus programme.