Rand drops at midday

The rand was softer in midday trade on Wednesday ahead of US retail sales data.

A local dealer said the South African currency will likely take its cue from the US June retail sales data, which is due out at 02.30am local time.

At 11.43am local time the rand was bid at R7.54 to the dollar, R9.57 to the euro and R11.48 to the pound. The euro was bid at $1.2707 from $1.2719 overnight.

Dow Jones Newswires reports that the euro extended its recent gains against the yen Wednesday as global risk sentiment improved and global equities continued to rally.

However, poor industrial production data from the euro zone knocked the single currency down from its earlier highs, especially against the dollar.

Unexpectedly good employment numbers out of the U.K. also helped to push the pound to a two-month high against the dollar.

Declining fears about the euro zone's debt crisis combined with optimism over the second quarter earnings season were the main factors driving the market with investors showing more appetite for risky assets at the cost of safe haven currencies, such as the dollar and the yen.