THE rand continued weaker against the dollar in late trade on Monday after US Federal Reserve chairwoman Janet Yellen’s hawkish speech on Friday, indicating the likelihood of an interest rate increase in the coming months if the US economy and labour market continued to improve.
Meanwhile, currency trading was muted because of public holidays in the US and UK.
At 3.29pm‚ the rand was at R15.8428 to the dollar from R15.6711 at the previous close. It was at R17.6543 against the euro from R17.4179 previously‚ and at R23.1526 against the pound from R22.8954 previously.
The euro was at $1.1143, from $1.1113 previously.
Treasury One’s chief currency dealer, Wichard Cilliers, said dollar strength was driving markets after Yellen spurred the dollar on Friday as she reiterated that a rate increase would be appropriate in the coming months as the US economy continued to improve.
Yellen expressed confidence that the inflation rate would move up to the Fed’s 2% target over the next couple of years as energy prices recovered, he said.
The quiet start notwithstanding, Cilliers said, he expected the week to end "with a bang" on Friday.
Tomorrow would see the release of local trade numbers, which would only be market moving if negative, he said.
The rest of the week would see a slew of US data releases which would build up to Friday’s US jobs numbers and Standard & Poor’s South African credit rating decision, Cilliers said.
