Picture: REUTERS
Picture: REUTERS

THE rand was firmer in early morning trade on Friday in a risk-on environment and on a stable dollar.

At 9.12am the rand was at R15.3834 against the dollar from R15.4718 previously

Against the euro the rand was at R17.1025 from R17.1258 and was at R22.0271 against the pound from R22.1082 previously.

The euro was at $1.1119 from $1.1107 previously.

Indications are that possible rate increases in the US may be pushed back, supporting emerging-market currencies such as the rand.

Momentum SP Reid said in early morning note that the US dollar had gradually improved in the short term, but the advances had left the US unit relatively range-bound with "no evidence of a decisive directional adjustment".

"For all practical purposes, the greenback is trading at the same level it was at 10 months ago, clearly illustrating the range-bound nature of its trading activity," it said.

Momentum said the rand continued to improve gradually even as short-term metrics were exceptionally stretched following the improvement of the past six weeks.

The market is eyeing next week’s budget speech. If the budget, as presented by Finance Minister Pravin Gordhan, fails to deliver according to expectations, the rand could weaken again from present firmer levels.