Easing off

The rand backed off a new four-month peak against the dollar on Friday but more gains were seen on the horizon against the ailing greenback.

RMB AM and Business Day report that in late afternoon trading on Friday, the rand was trading at R6,28 against the dollar, a couple of cents firmer than its late Thursday levels in Johannesburg but more than 3% stronger on where it ended last week.

At one point on Friday it hit R6,2425 to the dollar, its best level in nearly four months. If the rand closes above R6,30 to the dollar we may consolidate after this run but if it closes below there it could target R6,21 to the dollar.

Other market watchers have highlighted R6,20 and R6,14 against the dollar as key levels, which the currency could target.

The dollar completed a dismal week on Friday, dropping again versus the euro and the yen, although the US currency steadied after a solid August payrolls report.

The fact that $1,2485/$1.25 level was cleared on Thursday and then it held above there does suggest the dollar has broken down to a new range..... and is likely to be vulnerable in the days ahead.

In late trading, the euro was at $1,2545, up from $1,2493 late Thursday.