ZAR Forex Report – After action satisfaction, Rand looks to be strengthening as markets stabilise post US election
Early in Tuesday trade, the ZAR strengthened even further – at the time of writing USDZAR was below 14.10.
Not the most exciting week with event risk being low and markets seeming to have stabilised after the US elections.
Chances of Rand weakness remained high as US yields and the USD continues to surge as US rate hike seems very likely in December.
As the days rolled on after the election, conditions have been calmer, however the Rand is still on edge.
We are still seeing a negative bond flow with foreigners taking billions out of the country – R2bn last Wednesday with local retail sales disappointing and indicating the economy is contracting.
Rand opened at 14.27 against the USD on Wednesday and closed the day at 14.44.
From a technical view, it looked as though the ZAR has broken its channel and heading towards the 14.70 and eventually 15 mark.
Surprisingly, even having spiked to 14.65 against the USD, the Rand seemed to start the week off fairly positively.
The US market has stalled as US treasury yields have eased and the dollar has come back from its highs.
All of this was good news for emerging markets with foreigners buying R2bn worth of local bonds on Monday.
The ZAR appreciated to close at 14.19 on Monday, after opening the day at 14.44.
In other positive news, a minimum wage of R 3,500.00pm was agreed.
Early in Tuesday trade, the ZAR strengthened even further – at the time of writing USDZAR was below 14.10.
Not a great deal of events and risk this week, especially with the US Thanksgiving holiday on Thursday, but look out for SARB interest rate announcement on Thursday and also Moody’s rating decision on Friday.
Have a great week.
ZAR FOREX RATES
USDZAR = 14.0786
GBPZAR = 17.5202
EURZAR = 14.9674
AUDZAR = 10.4155
NZDZAR = 9.95416
CADZAR = 10.5085
CHFZAR = 13.9407
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