Forex Commentary 09th March 2009 

Forex

Gut Feeling

It seems there is no respite in the volatility of the ZAR and which direction to go. Another big factor in the ZAR weakening is the huge trade deficit and Zimbabwe coalition Government has not settled down to run the ruined economy. It’s now circling the news world - was Morgan’s accident planned or merely an accident. The trading range once again for the ZAR seems to be 9.75 to 10.65. It looks likely that the ZAR will resist higher levels on the divergence signal and could go as low as 10.2000 before a move higher to 10.8000. Gold over the next few months will look to replace the US$ as a safe haven commodity/currency. The market must be rather long of US$ and some profit taking has to be taken, so look for a correction of the ZAR back to the 10.1500 level. The USA jobless claims reached 650k proportions. Risk aversion is certainly going to be around, although pretty quiet at present do not discount it, while all this turmoil prevails in the markets. There is very little data out this week and expect the market to be quiet.

Data Releases

Thursday          SA mining sales and production, Manufacturing

Rates

USD / ZAR       10.4200/10.5200

EUR / ZAR       13.1698/13.2198

GBP / ZAR       14.6964/14.7064

ZAR / JPY       9.3885/9.4085

EUR / USD      1.2635/1.2645

GBP / USD      1.4100/1.4110

USD / JPY       98.25/98.35

Morning Commentary