* Rand dragged by euro to fresh 2012 low vs dollar
* Exporters may come in, otherwise 8.60/61 level is next
JOHANNESBURG May 30 (Reuters) – South Africa’s rand fell to
a new 2012 low against the dollar on Wednesday and was among the
hardest hit by a stampede away from riskier assets with
investors unnerved by the deteriorating euro crisis.
The European debt crisis appeared to deepen on Wednesday
with Italian and Spanish bond yields climbing again and showing
the vulnerability of the currency union.
The rand lost 2.5 percent against the dollar and
fell to a six-month low of 8.5250 in the afternoon session. It
closed at 8.32 in New York on Tuesday.
It was the weakest-performing currency in a basket of
emerging market currencies trading against the dollar and
tracked by Reuters, with investors using the rand to hedge other
risky positions.
Having broken through previous support at 8.45 and 8.50,
dealers say 8.60/61 is next up during the wave of heavy selling.
“We are now in the panic phase of the sell-off, and risk
markets are very fragile, so moves could be much more violent
and quicker to the downside. The rand is now open to 8.60,” said
Brigid Taylor, trader at Nedbank.
Dealers say that with the euro – the currency of South
Africa’s major trading partner – looking towards $1.22, the rand
may suffer the worst of the brunt against risky assets.
Continued…
