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Rand’s downward spiral continues on SA recession

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Just like Groundhog day (without the nostalgia), it’s unfortunately more of the same for the local unit and economy.

SA’s 2nd quarter GDP was released at -0.7% yesterday, confirming the economy has entered a technical recession. The rand lost close on 3% as it touched 15.38/$, 17.80/€ and 19.76/£ (that’s no typo).

Only one question remains, where to from here? With trade war tension between the US and China set to intensify and weakness in EM currencies, dare we say things could get worse. US trade balance figures (14h30) and speeches from Fed members this evening will be the highlights for today.

Latest Rates

USD/ZAR 15.4379
GBP/ZAR 19.8228
EUR/ZAR 17.8647
ZAR/JPY 7.2228
CNY/ZAR 2.2569
AUD/ZAR 11.0810
CHF/ZAR 15.8415
AED/ZAR 4.2036
SGD/ZAR 11.1929
NOK/ZAR 1.8359
EUR/USD 1.1571
GBP/USD 1.2840Continue reading…

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The trade talks set to spark rand volatility

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The rand has held its ground over the past 24hrs, but markets are expected to react as we draw closer to the highly anticipated two-day US-China bilateral trade talks.

Officials from the two economic heavyweights resume the contentious talks amid a cloud of uncertainty as Beijing’s feathers have already been ruffled by tariffs that will take effect today.

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There are no major economic releases today other than SA CPI figures (10am); and the Trump administration finds itself entangled in a legal drama. Have a wonderful Wednesday.

Latest Rates

USD/ZAR 14.3872
GBP/ZAR 18.587
EUR/ZAR 16.6602
ZAR/JPY 7.683
CNY/ZAR 2.1008

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Rand cracks under ‘perfect storm’

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The rand touched 14.75/$ yesterday after facing a barrage of negative news.

Turkey announced retaliatory tariffs against the US, Moody’s released a damning report on the state of SA’s economy (as did the SARB), ANC Chair Gwede Mantashe added fuel to investor fears surrounding property rights, SA’s retail sales for June hinted at a risk of recession and Africa’s largest company Naspers saw their share price plunge.

The rand has recovered some lost ground this morning, but further gains won’t come easily. On a positive note, SA looks set to conclude a deal with auto manufacturers in a boost for exports. We’ll be keeping a close eye on Turkey and trade wars again today, enjoy.

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Rain-check for rand losses?

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The rand strengthened 2% against the USD in early morning trade, as markets digest their exposure to the Turkish crisis.

Tukey remains firmly in the spotlight, with the question on everyone’s mind: ‘Is this the worst of the crisis, or a sign of trouble brewing in the global economy?’. The rand will likely bounce around 13.90/$ – 14.50/$ as it claws back into the 13.00/$ to 14.00/$ trading range.

The SARB announced that they will not take any action to support the rand, stating ‘rand moves don’t w
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Well well, the Dollar is down and the rand up!

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US President Trump threatened to impose tariffs on all $500bn worth of Chinese imports following China’s vow to fight until the end.

As trade tensions intensified the greenback lost ground, which saw EM currencies and the rand strengthen to close at 13.33/$ yesterday. Locally, the 2 day ANC Lekgotla meeting (7-8 August) is focusing on land expropriation and an economic stimulus package to create an enabling economy for investment.

There isn’t much data out for the rest of the week and we see the country celebrate National Women’s Day tomorrow (9th August). Have a Wonderful Wednesday!

Latest Rates

USD/ZAR 13.3301
GBP/ZAR 17.2477
EUR/ZAR 15.4788
ZAR/JPY 8.3424
CNY/ZAR 1.9518
AUD/ZAR 9.8934
CHF/ZAR 13.3973
AED/ZAR 3.6289
SGD/ZAR 9.7689
NOK/ZAR 1.6266
EUR/USD 1.1614
GBP/USD 1.2938Continue reading…

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US vs CHINA … vs the rand!?

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The rand along with other EM currencies were casualties (yet again!) as the US vs China trade war tensions continue to escalate.

China vowed to fight until the end, warning the US of “arrogance” and “making a fool of itself”. US treasury yields edged lower as investors fled to safety. The rand depreciated 0.9% against the dollar opening at 13.44/USD this morning.

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Not much data out today but do keep an eye out for corporate earnings and trade development between the two big boys (US & China) and SA manufacturing data. Have a Terrific Tuesday!

Latest Rates

USD/ZAR 13.3811
GBP/ZAR 17.3462
EUR/ZAR 15.4865
ZAR/JPY 8.3163
CNY/ZAR 1.9543Continue reading…

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South African Rand in a “Landslide”

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The rand weakened more than 1% against the majors overnight as the ANC confirmed Section 25 of the constitution will be amended.

This will allow for expropriation of land without compensation and saw investors drop the rand and head offshore to greener pastures with less risk. Before this bombshell the rand touched 13.06/$ yesterday on the back of a better than expected SA Trade Balance (R12 Billion surplus) although the unemployment rate worsened to 27.2%…eish!!

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The only data to look out for today is the US Fed interest rate decision tonight (20h00) with expectation for the rate to remain unchanged, but all ears will be listening for hints of future hikes.

Latest Rates

USD/ZAR 13.3280
GBP/ZAR 17.4763
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Eskom in the red

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The rand fell by 1% against the majors yesterday as the ailing power utility Eskom suffered a 2.3 billion rand ($170 million) loss for the 2017/18 financial year.

Markets digested the state-owned entity’s gloomy picture as it punches a hole in the government’s balance sheet. The rand is on the back foot as investors try to shrug off trade uncertainty and Trump’s recent tweet on Iran.

On the data calendar today, the BRICS boys are in town for the 2018 summit with Finance minister Nene and Reserve Bank Governor Kganyago speaking later on. Also on the cards is EU and US manufacturing data. Have a lovely one.

Latest Rates

USD/ZAR 13.516
GBP/ZAR 17.687
EUR/ZAR 15.781
ZAR/JPY 8.253
CNY/ZAR 1.9821
AUD/ZAR 9.9663
CHF/ZAR 13.5938
AED/ZAR 3.6758
SGD/ZAR 9.8865
NOK/ZAR 1.645
EUR/USD 1.1668
GBP/USD
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It’s still all about the US

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The local unit scored somewhat of a consolation goal on Friday (sorry Argentina fans), as global equities and EM markets ended the week stronger.

Eyes are still on the US though as June Fed minutes and job numbers will be out later this week. The data, coupled with escalating trade tensions between the US and China, could provide more volatility than the Spain vs. Russia penalty shootout.

On local shores, consumers are set to be hit with another sucker punch as the price of petrol is set to increase by 26c/litre. Combine this with higher municipal rates, taxes and electricity tariffs and you’ve got yourself an already overworked wallet. Have a great week and batten down the hatches if you’re in the Cape!

Latest Rates

USD/ZAR 13.83
GBP/ZAR 18.21
EUR/ZAR 16.09
ZAR/JPY 7.99
CNY/ZAR 2.07
AUD/ZAR 10.19
CHF/ZAR 13.95
AED/ZAR 3.76
SGD
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Rand creeps lower vs. EUR, USD and GBP

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While there’s been plenty of World Cup drama this week (mostly focused on VAR controversy) the rand has been having a less exciting few days.

But while ZAR hasn’t experienced a significant shift since the weekend, it has still edged lower against the US dollar, euro and pound.

Today’s high-profile US reports, including the nation’s trade balance and durable goods orders data, could have a modest impact on the rand, with upbeat data potentially undermining the emerging-market currency.

But we’ll also be looking ahead to tomorrow and the first South African data of the week. SA’s producer price index is expected to come in at 0.4% on the month and 4.3% on the year.

Latest Rates
USD/ZAR 13.54
GBP/ZAR 17.93
EUR/ZAR 15.80
ZAR/JPY 8.11
CNY/ZAR 2.05
AUD/ZAR 10.01
CHF/ZAR 13.67
AED/ZAR 3.68
SGD/ZAR 9.94
NOK/ZAR 1.
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