Rand was pressurized on Tuesday by weak commodity prices during the mid-hours of the day which was further pushed down due to the lower than the expected payrolls released on Friday as an after effect of the worsening global market conditions.
It is anticipated that the negative effects of the depleting economy of the United States are now trickling down to the other third world countries. The rate of unemployment in the United States is now affecting the commodity prices in other countries dependent on a lot factors coming from the US. One of the local investor spoke to the media and said, “We are feeling the after-effects of the poor US jobs data. This is affecting all commodity currencies, not just the rand.”
Several analysts have also commented on the below expected average prices of the commodities saying that the effects of the crippling economy of United States are now felt by other economies on the map as well and that puts a great question mark on the statements of the officials from Washington declaring that their economy is back on the recovery track.
Professional RBM analysts said, “Markets have swung back to expecting QE3, this is even after the Fed minutes last Tuesday suggested no such thing. We also lack clarity over the Chinese economy: the surprising jump of inflation to 3.6% in March suggests limited scope for aggressive monetary easing and therefore a higher risk of a hard landing.”
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