Currencies (7.7.04)

Currency traders expected the local unit to remain rangebound for the next couple of days until a sustained range gives it a new direction. Business Day and RMB AM report.

At 3,58pm, the rand was quoted at R6,1850 tot he dollar from R6,1750 on Monday. It was quoted at R7,5973 to the euro from Monday's close of R7,5763 and at R11,3910 against sterling from a previous R11,2970.

It has been very quiet and the rand has been extremely range-bound between R6,1675 and R6,21, a currency trader said. He thought it would stay in that range - at R6,20-R6,22 there are dollar sellers and at R6,16-R6,18 there are buyers.

The rand may be range bound for a day or two and then move. It will have to break either R6,10 or R6,25 to get new direction.

In New York, the dollar was under pressure yesterday after a weaker-than-expected US Service sector report curbed expectations for higher US interest rates and clouded the outlook for economic recovery.

The dollar's reaction to the below-consensus reading was muted but in general markets regarded the data as further reason to sell the greenback.