Rand Gains on Fed & ECB Stimulus
The rand rose today, following two days of decline, on signs that the US Federal Reserve and the European Central Bank plan to stimulate their economies, supporting inflow of higher-yielding assets.
I consider a highly accommodative policy stance to be appropriate in present circumstances. But considerable uncertainty surrounds the outlook, and I remain prepared to adjust my policy views in response to incoming information. In particular, further easing actions could be warranted if the recovery proceeds at a slower-than-expected pace, while a significant acceleration in the pace of recovery could call for an earlier beginning to the process of policy firming than the FOMC currently anticipates.
Earlier, Benoit Coeure, an executive board member of the European Central Bank, said the Bank may resume its program of sovereign-debt purchases.
USD/ZAR fell from 8.0000 to 7.9340 as of 12:28 GMT today.
If you have any questions, comments or opinions regarding the South African Rand, feel free to post them using the commentary form below.
Earlier News About the South African Rand:
- Rand Advances Ahead of European Ministers' Meeting (2012-03-30)
- Rand Ends 3-Day Rally on Concerns About China (2012-03-20)
- Rand Tumbles on Speculation that Central Bank Buys Dollars (2012-03-14)
- Rand Rises, Struggles to Keep Gains (2012-03-07)
- Rand Goes Down as China Cut Growth Forecast (2012-03-05)