The rand was range-bound in early morning trade on Tuesday after starting the week on a quiet note.
“Risk-on currencies have traded well‚ but thin-liquidity conditions persist‚ with small foreign capital outflows recorded last week‚” an analyst at Nedbank Corporate and Investment Banking (CIB) said.
The dollar had made a comeback against the euro since the beginning of the year‚ but the upside could be limited‚ analysts said.
A strengthening economic recovery has helped lift the euro more than 13% against the dollar over the past year. Some investors believed the euro’s rally may not sit well with the European Central Bank (ECB)‚ as a stronger currency tended to slow inflation and make exporters’ goods less competitive abroad‚ Dow Jones Newswires reported.
The rand gained nearly 10% against the greenback during 2017‚ but started 2018 on a subdued note as the market awaited developments in the ANC after Cyril Ramaphosa was elected leader in December.
The ANC’s national executive committee will meet on Wednesday and members are set to discuss the removal of Jacob Zuma as the country’s president. Any indications that Zuma will leave could support the rand.
At 8.19am the rand was at R12.3971 to the dollar from R12.3836‚ at R14.8309 to the euro from R14.8209 and at R16.8271 to the pound from R16.8026.
The euro was at $1.1964 from $1.1967.
Source: TMG Digital.