Rand improves as market eyes US job numbers

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The local currency has benefited lately from a weak dollar, which follows a policy shift by the US Fed to allow higher inflation

The rand was firmer on Friday morning, in line with its emerging-market peers, as currency traders awaited US non-farm payrolls data later in the day.

The jobs data is a key barometer of the health of the US economy and will ultimately determine the direction of the rand after a volatile week, said FXTM senior research analyst Lukman Otunuga. A figure above market estimates would help the dollar and weigh on the rand, said Otunuga, but that may only be in the short term.

“A positive report could benefit the local currency in the medium to longer term as optimism returns over the largest economy in the world,” he said. The rand has benefited from a weaker dollar lately, with the US Federal Reserve recently saying it was willing to allow inflation to breach 2% for short periods of time to help economic activity.

 

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