South African rand gains on expectations of Fed rate cut
JOHANNESBURG (XiarraMedia) -The South African rand gained in early trade on Wednesday, as investors braced for a day headlined by the Federal Reserve's decision and an easing of U.S.-China trade tensions. At 0638 GMT, the rand traded at 17.1350 against the dollar, up about 0.1% from its Tuesday close. "The ZAR put in a strong performance from yesterday afternoon. It is higher against all the majors, even with the gold price staying below $4,000.00. The main reasons is that the U.S are almost certain to cut rates tonight," said Adam Phillips, treasury specialist at Umkhulu Treasury. Economists have said the U.S. Federal Reserve is poised to reduce interest rates by 25 basis points at its meeting tonight. Phillips added that operators are also looking ahead to U.S President Donald Trump's meeting with Chinese President Xi Jinping tomorrow which could influence sentiment. Domestically-focused traders looked at money supply and private sector credit data which came out at 0600 GMT today. South Africa's benchmark 2035 government bond was firmer in early deals, as the yield fell 1.5 basis points to 8.87%.
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