The South African Rand made gains against the Pound Thursday as manufacturing data out Africa’s disappointed and as the US Federal Reserve hinted that it wants to cut its monetary easing programme.
According to Statistics South Africa, manufacturing increased at its slowest pace in five months in August after strikes damaged production. Growth in factory output slowed to 0.2% in August, down from the 5.5% recorded in July. Economists had been calling for a growth level of 1.2%.
The spate of strikes that hit the South African economy over the summer badly affected the nation’s industrial output. The month long strike in the motor industry saw vehicle shipments tumble by 75% in September from the previous year.
Earlier in the session the Rand found some support after data showed that mining production increased by 2.1% on a year by year basis. The figure was better than the previous one of 1.2%.
Also weighing upon the Rand was the increase in demand for the US Dollar after the minutes of the Federal Reserve’s latest meeting showed that most policymakers were still in favour of tapering stimulus this year.
“The Rand has been afforded some breathing room this month owing to what has been a very steady weakening trend on the Dollar. However, the Dollar index is now showing signs of making a rebound on hints of compromise between US Congressional leaders,” Tradition Analytics wrote in a research note.
The ‘Greenback’ received further support from increasing investor confidence that a deal will be made to raise the USA’s debt ceiling before the October 17th deadline.
The US Dollar also shrugged off a report by the Department of Labour which showed that U.S. initial jobless claims rose to a six-month high of 374,000 last week, up 66,000 from the previous week’s unrevised figure of 308,000.
Current South African (ZAR) Exchange Rates:
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The US Dollar/South African Rand Exchange Rate is currently in the region of: 9.9704 <
The Pound Sterling/South African Rand Exchange Rate is currently in the region of: 15.8917 <
The Euro/South African Rand Exchange Rate is currently in the region of: 13.4730 <
The Australian Dollar/South African Rand Exchange Rate is currently in the region of: 9.4045 <
The New Zealand Dollar/South African Rand Exchange Rate is currently in the region of 8.2312 <
The Canadian Dollar/South African Rand Exchange Rate is currently trading in the region of 9.5914 <
(Correct as of 15:30 pm GMT)