For the first time since the reshuffle and junk status announcement the South African Rand is bouncing back making people sigh in slight relief!
The South African Rand was briefly trending on Twitter this morning after it bounced back from it’s reshuffle fall. Before President Zuma reshuffled his cabinet the rand was at R 12.40 to the dollar. After the reshuffle the rand hit a low of R 13.35.
It has been 24 days since the reshuffle and today for the first time the rand has bounced back, moving away from the R 13.00 mark.
“At 9.02 the rand was at R12.9745 to the dollar from Friday’s R13.0051 and at R14.0738 to the euro from R14.1563 and at R16.5854 to the pound from R16.6672.”
According to RMB global markets analyst John Cairns, the currency strength is because,
“global short-term pressures on the rand have eased”.
The improvement is also due to a better outlook for agriculture in South African and the fact that the dollar has weakened because of uncertainty as to whether US President Donald Trump can deliver on his promises to grow the economy.
Another influence was the strengthening Euro thanks to the favourable outcome for the first round of the French Elections.
“Over the weekend the French elections provided some comfort to the markets with the (successful) moderate candidate providing support for the euro, and in turn to emerging markets,”
“The price action in the rand would suggest that at the current time, global factors outweigh the ongoing local political wrangling and recent events.” – Nedbank Capital analysts in a note.
Whatever the reason, lets hope that it continues the progress!
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