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Daily Dose

6 February 2014

Happy Friday,

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On the wires

Eight trapped miners die in Harmony fire, one still missing…Western Cape High Court declares part of the Sexual Offences Act unconstitutional…Almost 200 free state clinics need fixing…Cruel China New year dances sparks controversy… Sports Limousine to be unveiled soon…Ronaldo gets three-match ban… Real, Barca on course for Cup final showdown… There is no gain in losing Kevin Pietersen…

Currency Crackdown

So far this week most emerging market currencies have put in for significant recovery moves against the safe haven US dollar. However, that exchange rate stabilisation doesn’t seem to be drawing capital back into the troubled group. The rand traded in a range of 11.0625-11.18 with the mixed data that came out yesterday. The question on everyone’s mind is in which direction will this currency go.

A sharp month-on-month drop in the US ADP payrolls led to a 1.3% intraday rally for gold, although it was unable to hold those gains for long.

Against the Euro the dollar was little moved after the Euro found support from positive Eurozone private sector data. A separate report however showed that retail sales across the single currency region fell at the fastest pace since May 2011.

The upcoming ECB decision on Thursday has a significant chance of introducing fresh stimulus, which could in turn bolster the dollars relative appeal. The other monetary policy decision of note will be the BOE’s meeting. There is serious disconnect between the policy group’s most recent guidance and the market’s expectations. A quick tumble in the jobless rate to near the MPC’s target 7% jobless rate is the culprit. And a little further out we have Fridays NFPs.

Two Cents Worth


“In three words i can sum up everything i have learned about life. It goes on.”... Robert Frost
 

Did you know?

When somebody smells good, we automatically perceive them as more attractive…

Have a wonderful day,

Kim


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