After the excessive movements of the last couple of days today, we did see some relative calm in the market, with the Rand trading in a 15-cent range since the South African market opened this morning. The Rand is currently trading at R 17.94 and seems rather comfortable below the R18.00 handle. The US dollar is also slightly stronger this afternoon, with the greenback flirting with the 0.9600 level against the Euro. With the Rand not following the US dollar, it could be a case of the Rand having stretched too far, but we need a series of Rand positive sessions to confirm this. The relative calmness has extended to the Pound as well as the rollercoaster from yesterday has subsided a little.
With not much data out of the US, this week's attention will be focused on the Eurozone on Friday, with the EZ inflation number out. We expect markets to linger in current ranges up until Friday as rampant inflation could see the Euro under pressure further and pressure on the ECB to hike more aggressively into an already weak economy. Friday could be a rough day for the Euro should data reflect a weakening economic situation.
