As trade began this morning, stabilising global markets allowed the Rand to firm. Although the commodity-driven currency weakened slightly against the Pound it strengthened to below 10 Rand per Dollar against its American rival.
At the current exchange rate 1 Pound will purchase 15.2044 South African Rand as of 13:55 GMT
Before the release of South African trade balance figures one local trader commented: ‘The stability may be due to people squaring off positions, as today is both quarter-end and year-end for many companies with June year-ends. If we break through resistance at R9.88, then the Rand could run, but at the moment the current level is more likely to be the bottom of a range.’
It was forecast by economists that today’s report would show that South Africa posted a deficit of -12.3 billion Rand following April’s -15.02 billion Rand shortfall. Just before the figures were released the Rand posted modest but widespread declines.
The GBP/ZAR exchange rate hit a high of 15.3096
But the figures actually revealed that South Africa’s trade balance rose to -11.03 billion Rand.
The better-than-expected result could relieve some of the pressure on the current-account gap, but monthly trade figures are notoriously volatile.
The Rand was little changed against its major counterparts after the figures were released.
However, Rand Merchant Bank believes that the South African currency could be on course for a relief rally. In a morning report published today the financial institution asserted: ‘Having startled the market with the tapering talk, Fed officials are now trying to calm things down. Their new favourite saying is ‘markets are out of sync’ – meaning that the reaction to the tapering talk has been overdone. [Currency markets] are trading a little divorced. Some risk currencies, for instance the Rand and the Mexican Peso, are tracking the other global markets but most others continue to sell-off or are at best stable. This divergent puts the Rand at risk of becoming overstretched, which is perhaps why downside momentum on the Rand is struggling.’
Current South African (ZAR) Exchange Rates
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The US Dollar/South African Rand Exchange Rate is currently in the region of: 10.0020 >
The Pound Sterling/South African Rand Exchange Rate is currently in the region of: 15.2044 >
The Euro/South African Rand Exchange Rate is currently in the region of: 13.0791 >
The Australian Dollar/South African Rand Exchange Rate is currently in the region of: 9.2101 >
The New Zealand Dollar/South African Rand Exchange Rate is currently in the region of 7.8515 >
The Canadian Dollar/South African Rand Exchange Rate is currently trading in the region of 9.4490 <
(Correct as of 13:55 GMT)
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