Currency News this week in South Africa
This week has been a quieter than normal week, with not many major changes occurring, this is the latest:
- The Rand dropped following the budget. It has since stabilized and made small gains. It has reached the R19.00/USD level again. The Rand has been performing better than most currencies in recent days. The exchange rate range of R18.80/USD to R19.20/USD remained stable, which is good news. There were concerns that exceeding this range could lead to further losses. Today, GDP numbers are released. Inflation and the MPC rate decision are coming soon. But, we think election talk will have a bigger impact on the Rand in the next few weeks and months.
- The Rand's value is mostly influenced by how the US dollar is doing. When the US dollar is weak, the Rand gets stronger compared to other currencies, and vice versa. The value of the Rand is mainly affected by the performance of the US dollar. When the US dollar is weak, the Rand strengthens against other currencies. The opposite is also true. The most significant economic event this year will be when markets anticipate the first interest rate cut by the US. Each Federal Reserve meeting brings us closer to this anticipated moment. It's clear that every meeting of the Federal Reserve brings us closer to this moment.
- The USD index has been less volatile recently. This may change soon with Fed Chair Powell speaking tomorrow and Non-Farm Payrolls data coming out on Friday. Expect more volatility towards the end of the week.
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