The Pound has found itself in demand against the South African Rand today, thanks to a forecast-beating set of retail sales results.
The Rand has been a less appealing prospect, on account of the recent news that the nation’s controversial President is still in power.
Pound Trends Tightly against South African Rand despite Bumper Sales Stats
The Pound South African Rand exchange rate has risen to 17.80 today, although far greater gains have been seen elsewhere.
The latest source of support for GBP has been the October retail sales results, which have risen above estimates in all fields.
Meanwhile, the Rand has been reeling in the wake of two damaging recent developments.
The first was the election of Donald Trump as US President. This has raised concerns of a higher US interest rate in the wake of spending pledges, harming the Rand, along with other global commodity currencies.
Additionally, South African President Jacob Zuma has recently survived another vote of no confidence issued by opposition parties the Democratic Alliance (DA) and Economic Freedom Fighters (EFF), which has softened the Rand due to the controversial leader still remaining in office.
Pound Sterling Predictions: Autumn Statement Fallout Likely to Unnerve Investors and Weaken GBP
The Pound’s next source of significant UK input is likely to be the November 23rd Autumn Statement, as well as the immediate and long-term aftermath.
Set to be delivered by Chancellor Philip Hammond, the statement has been predicted to broadly focus on increased public spending in the face of previous years of harsh austerity measures.
Should this change of direction appeal to UK businesses and overseas investors, they may be convinced to stay put or expand their UK operations, which would prove beneficial to the Pound.
If Hammond’s mathematics are perceived not to add up, however, then the Pound may be softened considerably as businesses look for a way out of the UK before it finally separates from the EU.
ZAR GBP Turbulence Expected on Future Challenges to Zuma
Although the latest efforts to remove Zuma from power have been thwarted, it seems inevitable that the DA and the EFF will be looking for further ways of dislodging the controversial President.
While Zuma has been Teflon-like in his avoidance of impeachment, the fact that the Rand appreciates whenever his tenure is challenged bodes well for ZAR investors in the future.
As a case in point, Zuma has been confronted with no confidence votes three times in 2016, so it seems probable that further obstacles to the Zuma presidency will be thrown up in 2017 as well. These are likely to raise demand for the South African Rand in the process as investors grow more hopeful he will be ousted and more stable leadership installed.
Recent Interbank Exchange Rates
At the time of writing, the Pound South African Rand (GBP ZAR) exchange rate was trending in the region of 17.75 and the South African Rand Pound (ZAR GBP) exchange rate was trending in the region of 0.05.
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