ZAR Forex Report

Another action packed week for the ZAR in the global currency trenches – Domestic Politics, Possible Fed rate hike and diminishing Brexit fears…….

Last week we saw several key factors driving the markets, most notably the Federal Reserve Bank meeting minutes where they renewed the drumroll of a possible US rate hike sooner than expected and then of course GBP galloping along and gaining against all currencies as fears of Britain leaving the EU have died down somewhat.

The second half of last week saw the Reserve Bank keep Interest Rates the same which caused a knee-jerk reaction where we saw the ZAR lose more ground against most currencies. We saw USD/ZAR and GBP/ZAR almost touching 16s and 23.30s before settling down to 15.63 and 22.65 respectively.

Over the weekend the circus continued, the Hawks issued a statement saying that Pravin Gordhan should have no reason to be worried about being investigated – one has to wonder whether there will be another twist once municipal elections are out of the way in a few months’ time.

On Monday morning the Hawks statement gave the ZAR some impetus where we saw USD/ZAR touch 15.52. Unfortunately this momentum was short-lived and the ZAR has been under pressure again since yesterday morning with USD/ZAR and GBP/ZAR back to 15.84 and 23.01 by 10am today.

There is very little event risk to speak of so we will need to watch the dollar for any direction this week.

And finally, …Standard Bank confirmed that it was a victim of a fraud scam in May where it involved cash withdrawals using fake cards at a number of ATM’s in Japan – estimated loss = R250mln

Data to look out for this week:
• Today: German ZEW Economic Sentiment, US New home sales
• Tomorrow: US Crude Oil Inventories,
• Thu: UK GDP, US Core Durable Goods Orders, SA PPI
• Fri: US GDP

Have a great week; let’s make it rain.

ZAR FOREX RATES
USDZAR = 15.7428
GBPZAR = 22.8979
EURZAR = 17.6032
AUDZAR = 11.2772
NZDZAR = 10.5920
CADZAR = 11.9558
CHFZAR = 15.8644

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