South African Rand Remains Bullish on Dubai Optimism

The South African rand extended gains from last week as concerns regarding Dubai’s debt declined today, providing support for risk fueled traders to purchase assets in emergent markets and commodity linked countries like South Africa.

After the Abu Dhabi financial authority bailed out Dubai with $10 billion, concerns that a major debt disaster involving European banks cooled down today, allowing risk appetite to grow and forcing the greenback down versus the South African rand.

USD/ZAR declined and closed at 7.5150 today from an opening rate of 7.5438.

Dollar Down Slightly on Temporary Risk Appetite

After several days gaining versus most of the 16 main traded currencies, the dollar dropped since risk appetite provided strength for currencies to gain versus the greenback, erasing partially gains earned on previous sessions.

The U.S. dollar had its rally halted today as optimism surged regarding the Dubai financial situation, as its brother Emirate, Abu Dhabi, started a bail out process essential for avoiding chaos in financial markets world wide, fueling traders with optimism and declining attractiveness for the greenback slightly.

EUR/USD traded at 1.4653 from an opening rate yesterday of 1.4624.