The rand has been a tough challenge for market watchers to predict this week, at one point threatening to break R16.00/$ with international trade disputes, emerging market weakness, SA’s technical recession, dollar strength and land reform all in the mix
But after weakening by as much as 6.5% against the dollar by mid-week, the local currency started to firm Thursday. On Friday at 10:52 it was trading 1.4% stronger against the dollar at R15.11. It opened the day’s trade at R15.33.
The rand’s most recent strengthening may have to do with some positive economic news around the account deficit after a week of shocks.
“The narrowing of the current account deficit, from 4.6% of GDP to 3.3%, assisted in capping the downward spiral,” said Bianca Botes of Peregrine Treasury Solutions in a morning note.
“Volatility, instability and emerging market contagion fear all remain on the cards, ensuring yet another bumpy time ahead.”
TreasuryONE said in a morning note that international markets were awaiting the release of US employment data.
Strong figures may again cause the rend to weaken.
