News

30 Jul 2019 Rand shrugs off dire unemployment rate as it awaits Fed rate cut tomorrow +

Unemployment for the 2nd quarter 2019 accelerated to 29%, up from the previous high of 27.6% in Q1 2019. Surprisingly, the dire number had no effect on the currency as the anticipated US Federal Reserve interest rate cut overshadows local market events for the time being.

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26 Jul 2019 Rand loses 3% in two days on dovish ECB, strong US GDP and negative Fitch outlook +

The US GDP surprised to the upside today, gaining 2.1% quarter-on-quarter annualised for the second quarter of 2019. The resilience of the US economy, evidenced not only in the ongoing strong GDP numbers but also employment figures, leaves many questioning whether the Fed is not acting too soon with regards to an interest rate cut. The Federal Reserve has been widely anticipated to cut rates by between 25 and 50 basis points next week however, following today’s data, the market is clearly leaning towards the shallower end.

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27 Jun 2019 Rand – sell into strength +

The rand has shown surprising strength in the past few days offering market participants an excellent opportunity to buy foreign currency. Peregrine Treasury Solutions Corporate Treasury Manager Bianca Botes discusses the several drivers that the local unit has benefitted from.

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20 Jun 2019 Timing the forex market – can it be done? +

It’s true that the forex market never sleeps – there’s always someone trading currency somewhere around the globe at any time of the day or night – but are there optimal times when one can benefit from transacting? Absolutely! When buying or selling forex, timing is often crucial. But there are other aspects to consider as well in order to maximise operational and financial efficiency.

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05 Jun 2019 More own goals for the rand +

The public spat between the leadership of the ANC regarding the mandate of the SARB is adding additional pressure to the already strained local currency. Both the Finance Minister, and the ANC’s head of economic transformation denied that the mandate of the SARB has been broadened to include quantitative easing measures to drive growth and employment, as previously stated by the party’s secretary-general Ace Magashule.

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04 Jun 2019 Rand slumps in face of worst GDP performance since global financial crisis +

At -3.2%, quarter-on-quarter, seasonally adjusted and annualised, the first quarter GDP figure has come in far worse than the expected -1.6%, with manufacturing being one of the biggest contributors to the drop, falling by 8.8%. This is the biggest decline in GDP since the 2008 financial crises, highlighting the dire state of the South African economy.

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29 May 2019 Rand barely skips a beat as Ramaphosa announces a new cabinet +

President Ramaphosa kicked off his public address by announcing a reduction in cabinet from 36 to 28 portfolios and, while this is a step in the right direction, the cabinet still remains bloated when compared to the cabinet of the late President Nelson Mandela which consisted of 18 cabinet ministries. One of the key changes is the additional responsibility for Employment included in the Labour portfolio, two controversial fields that seem to work against each other rather than in conjunction.

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28 May 2019 Rand slumps 1% on trade fears and cabinet anxiety +

The rand has lost over 1% today as the ongoing trade tensions weigh heavily on sentiment and risk appetite. While President Ramaphosa is likely to name his cabinet later today, the swearing in of David Mabuza as an MP opens the potential for him to become the Deputy President.

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07 May 2019 Rand ignores improved confidence on pre-election nerves +

The SACCI Business Confidence Index increased somewhat to 93.7 in April from the previous 91.8. The rand is unresponsive to the good news, remaining largely flat since markets opened this morning in anticipation of the election take place tomorrow. The ZAR is currently at R14.47/$.

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23 Apr 2019 Rand tumbles as US markets open +

The rand has tumbled as US markets have opened, with the local unit losing close to 0.9% during trade on Tuesday. The rand’s decline can be largely attributed to the bailout of embattled state-owned enterprise Eskom as well as Trump entering into a trade conflict in the European Union, promising retaliation with regards to tariffs.

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