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Johannesburg. — The rand was weaker yesterday morning after the US Federal Reserve kept interest rates unchanged, but signalled a possible hike later this year. At 9.12am the rand was at 12,6335 to the dollar from a previous close of 12,5446. The rand was at 13,8424 against the euro from a previous close of 13,7831 and at 19,6986 to the British pound from 19,5713 previously.

The euro was at $1,0957 from its previous close of $1,0986. Investec economist Annabel Bishop said the federal open market committee (FOMC) statement released on Wednesday essentially left the door open for the Fed to hike interest rates at its September meeting (a 25 basis point hike was expected) or later in the year. The Federal funds target rate was unchanged at 0 to 0,25 percent.

The Fed’s statement made particular mention of the labour market, noting “solid job gains and declining unemployment” and “that underutilisation of labour resources has diminished since early this year”, sounding more confident overall in its assessment of labour conditions in the US.

“Should the Fed hike in September, we do not believe the Reserve Bank will necessarily follow suit at its September . . . MPC (monetary policy committee) meeting,” Ms Bishop said. — BDlive.