MARKET WRAP: Rand extends losses as risk sentiment wanes

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The rand is likely to remain volatile as markets await the medium-term budget; the rescue plan for Eskom; and a credit-ratings review from Moody’s

The rand extended losses on Tuesday as investors remain uncertain about the trajectory of the US-China trade war and global economic growth.

This followed reports that China wants to hold another round of talks before signing the “phase one” trade agreement with the US. “Easing US policy creates the space for looser policy in emerging-market economies, which will be conducive to domestic growth. For SA, however, the problem of restarting sustainable economic growth is more unique — looser monetary policy by the Reserve Bank [alone] will struggle to deliver growth,” Monex Europe analyst Simon Harvey said.

The Dow was up 0.91% to 27,032.36 points. In Europe, the FTSE 100 was flat while France’s CAC 40 added 1.43% and Germany’s DAX 30 1.5%.

 

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