Last week the Rand tumbled to a four-year low of 9.6920 against the US Dollar as domestic concerns and global news battered the commodity-driven currency.
Today, worse than anticipated South African GDP figures have seen Rand weaken to fresh lows.
At the current exchange rate 1 US Dollar will purchase 9.6940 South African Rand as of 10:50 am GMT
Ahead of the publication of the GDP data the Rand was trading in the region of 9.6311 against the US Dollar.
Economists had forecast that quarter-on-quarter growth would slide to a seasonally adjusted 1.6 per cent in the first three months of this year from the previous quarter’s 2.1 per cent.
Year-on-Year, GDP was expected to edge down from 2.5 to 2.4 per cent.
As stated by one local foreign exchange dealer: ‘The price action this morning tells you that the market is expecting a disappointing GDP figure. We are more bullish, but we will have to wait for the data.’
However, the figures actually came in lower than anticipated, with QoQ growth of just 0.9 per cent and YoY growth of 1.9 per cent.
After the data was published the Rand weakened further, briefly hitting 9.7105 against the US Dollar.
As currency strategist Bruce Donald notes: ‘GDP numbers will impact the currency market largely via the implications for monetary policy. Weak economic growth means that the incentive for the central bank to ease policy remains strong.’
The USD/ZAR pairing could experience additional movement in the hours ahead following the release of a US consumer confidence report.
Economists are expecting the consumer sentiment index to have risen to 71 this month from 68.1 last month and the US Dollar has broadly strengthened as a result.
Current Rand (ZAR) Exchange Rates:
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The South African Rand/US Dollar Exchange Rate is currently in the region of: 0.1032 <
The South African Rand/Euro Exchange Rate is currently in the region of: 0.0806 <
The South African Rand/Pound Sterling Exchange Rate is currently in the region of: 0.0686 <
The South African Rand/Australian Dollar Exchange Rate is currently in the region of: 0.1083 <
The US Dollar/South African Rand Exchange Rate is currently in the region of: 9.6935 >
The Pound Sterling/South African Rand Exchange Rate is currently in the region of: 14.6037 >
The Euro/South African Rand Exchange Rate is currently in the region of: 12.5078 >
The Australian Dollar/South African Rand Exchange Rate is currently in the region of: 9.2857 >
(Correct as of 10:45 am GMT)
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