Johannesburg – The rand rallied on Friday thanks to carry appeal and risk-on sentiment as the dollar index extended losses amid Jackson Hole policy guidance according to NKC Research.
The Fed unveiled significant changes to its policy goals following its 18-month long comprehensive framework review.
As expected, the Fed formally adopted flexible average inflation targeting, although, somewhat unexpectedly, it tweaked its employment mandate to be more asymmetric: one in which low unemployment presents less of a need to tighten policy so long as inflation remains close to 2% target.
This also shows that the Fed will be willing to let the economy “run hot” in order to promote broad and inclusive employment gains.
At the close of local trade, the rand quoted 1.88% stronger at R16.63/$, after trading in range of R16.60/$- R17.06/$. Expected range today R16.4-/$- R16.80/$.