THE rand was stable at weaker levels at midday yesterday as the sharp sell-off in the local currency since the beginning of the year subsided a little.
The market is taking a breather before the release of Chinese trade and growth data over the next few weeks. China is expected to release its trade data for December today.
At 11.30am, the rand was trading at 16,7635 against the dollar from a previous close of 16,7751. It reached a worst level of 16,9549/$ in morning trade.
Against the euro the rand was 18,2140 from 18,2181 previously, and 24,3210 against the pound from 24,4026.
The euro was at $1,0865 from a previous close of $1,0859.
Analysts said some liquidity was returning to the market from oversold levels.
The recent weakness was characterised by very low liquidity, mainly in Asian markets.
“At current levels the rand is four standard deviations away from its long-term mean of 13,82 to the dollar— the sharpest extension in the past six years,” Nedbank CIB analysts said.
Although significantly oversold, the rand was unlikely to recover by a large margin just yet, Nedbank said.
“Technical levels to look out for are the 2016 weakest level of 17,92/$ and projected technical target levels of 19,49/$ and 20,46/$.”
The rand had weakened 9,19 percent against the dollar so far this year. On a trade-weighted level it had lost 12,6 percent, the analysts said.
“Given much uncertainty regarding the local sociopolitical backdrop, global developments and sentiment towards emerging markets, along with geopolitics, the trade-weighted rand may … extend to further record lows in the coming weeks,” Nedbank said.—BDLive.