The rand was a lot weaker on Friday morning‚ reacting to wild swings in the dollar‚ which has been battling to find a suitable range throughout the week.
The volatility in the dollar came as markets second-guessed candidates thought likely to take over from Janet Yellen‚ whose term as the US Fed chairperson expires early in 2018.
Economist John Taylor‚ whom the markets perceive to be hawkish‚ is vying for the job. There has also been uncertainty about the trajectory of US interest rates in 2018‚ given the relatively low inflation profile in the US.
But the dollar was a lot stronger against a host of other currencies in early trade‚ boosted in part by optimism over tax cuts‚ which it is hoped would ultimately lead to high inflation and higher rates.
“The most recent news regarding the Trump tax cut is that the US senate adopted a 2018 budget resolution‚ which Republican leaders have agreed to accept and indicates a degree of urgency to pass the tax reform‚” said TreasuryOne currency dealer Phillip Pearce.
The fluctuation of the dollar coincided with renewed local political concerns‚ which weighed on the rand earlier in the week.
At 9.59am‚ the rand was at R13.6462 to the dollar from R13.5661.
It was at R16.1096 to the euro from R16.0708 and at R17.9194 to the pound from R17.8577.
The euro was at $1.1806 from $1.1846.
by Andries Mahlangu-BusinessLIVE
