ZAR Forex Report
The ZAR was dealt a stunning blow when Pravin Gordhan’s summons to court grabbed the headlines this morning and has caused the ZAR to depreciate significantly during the morning’s trade.
Pravin Gordhan issued with a summons to appear in court – the ZAR soap opera continues….
The main highlights last week were mainly the GBP “flash crash”, the SAB deal finally going through and increasing likelihood of a possible US FED rate hike.
GBP suffered a massive plummet on Friday in what was clearly a human or computer error – this has resulted into an investigation into the flash crash which occurred during Asian trading hours when trading and buyers were thin.
The market has priced a possible rate hike in the US at 65% – if rates do rise then this will have a negative impact on the ZAR.
All eyes will be on tomorrow’s FOMC meeting minutes as well as Yellen’s speech on Friday for any further hints on the near future.
This week started off relatively incident free yesterday with many eyes on what will happen now that the SABMiller deal has been concluded – yesterday was the last day that ABI could buy the ZAR that it needs.
South Africans start getting paid out between now and the end of the week – one would suspect that a portion (the bigger the worse for the ZAR) will then be sent offshore.
It is worthwhile keeping an eye on this.
The ZAR was dealt a stunning blow when Pravin Gordhan’s summons to court grabbed the headlines this morning and has caused the ZAR to depreciate significantly during the morning’s trade.
At 10am, the news caused GBP/ZAR to move from 17.10 to 17.53, USD/ZAR from 13.92 to 14.24 and EUR/ZAR from 15.47 to 15.84 – all in the space of 20 minutes.
The ZAR has pulled back ever so slightly since today’s highs. One would expect greater volatility as the saga continues. Court date is set for November 2nd.
Finally, it will be very interesting how Thuli Madonsela’s state capture report goes on Friday – one would suspect that a few cages will be rattled.
US FOMC meeting minutes on Wednesday, SA mining and gold production well as US Jobless claims on Thursday.
On Friday we see Yellen Speak which may increase likelihood of rate rise.
Have a great week.
ZAR FOREX RATES
USDZAR = 14.2884
GBPZAR = 17.5159
EURZAR = 15.8274
AUDZAR = 10.7798
NZDZAR = 10.1128
CADZAR = 10.8021
CHFZAR = 14.4610
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