The South African Rand has rallied against the Pound and the majority of its most traded peers after Wednesday are manufacturing production data which smashed economic forecasts.
According to Statistics South Africa manufacturing production rose by 5.4% year on year in July, up from the revised figure of 0.5%. On a month-by-month basis, output smashed forecasts of a rise of 3.37% and soundly improved on the previous months reading of -3.0%.
The strong growth in output is a result of a 7.95 rise in the output of basic steel and iron, metal products, a 6.1% increase in food and beverage production and a 3.9% growth in the output of petroleum, chemicals, rubber and plastic goods.
The recent decline in the value of the Rand is also thought to have assisted businesses in the country.
“Some exporters have noted the benefits of the weaker Rand on export growth,” said Kamilla Kaplan, an economist at Investec Ltd.
The Rand had been weighed down by worse-than-expected current account data in Tuesday’s session. The current account deficit remains a sore point for the currency and leaves South Africa’s economy vulnerable to shifts in investor sentiment.
The strong data out of China and the reduced chance of a military strike against Syria improved risk sentiment and the rise in commodity prices also benefitted the commodity based South African economy.
The Rand is also finding support from the ending of strike action. Gold miners and workers in the nation’s automotive industry called an end to their strikes. The threat of further labour unrest continues to weigh upon the currency however.
Current South African (ZAR) Exchange Rates:
The US Dollar/South African Rand Exchange Rate is currently in the region of: 9.9308 <
The Pound Sterling/South African Rand Exchange Rate is currently in the region of: 15.6364 <
The Euro/South African Rand Exchange Rate is currently in the region of: 13.1782
The New Zealand Dollar/South African Rand Exchange Rate is currently in the region of 8.0082 <
The Canadian Dollar/South African Rand Exchange Rate is currently trading in the region of 9.5981 <
(Correct as of 14:30pm GMT)
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