Dollar losing more ground
US PPI for March came out below expectations, increasing 2.7% vs. the 3% expectation. Apart from that, Jobless claims increased for a third week in a row, perhaps indicating that the labour market is not as solid as the Non-Farm Payroll number indicated on Friday. The data followed a week where CPI also printed below expectations, and the Fed warned that they are weary of the stability in the financial sector, causing the Euro to bounce to 1.1050 and the pound to 1.2530. The dollar index is struggling and dipped further, currently quoted at 100.95. We have seen equity markets gaining ground, bond yields dropping further, and Gold rallying to $2,045 after this afternoon’s data.
Rand is stronger but still off pace
The rand is starting to catch up to other EM’s, gaining 1.6% against the dollar on the day. The move has seen the rand close the gap between other EMs and us, but we are still lagging behind our peers in recent times. Local concerns could keep markets from flooding to buy our attractive yields, but for now, the rand put in a solid effort to trade back around the R18.10 handle.
