The rand reigns supreme as risk trade holds firm

GBP/ZAR depreciated by 0.97% throughout the week. After kicking off at R19.85 on Monday and touching lows of R19.44, the GBP/ZAR pair closed the weekly trade slightly below the R19.65 resistance degree. 

The rand adopted an identical trajectory towards different main developed market currencies, gaining 0.78% and 1.36% towards the US Dollar and Euro respectively. At the tip of the week, the rand was buying and selling at R14.20 towards the Dollar and R16.77 towards the Euro.

Last week, South Africa launched its GDP progress rate for the second quarter of this year. GDP progress got here in at 1.2% over the quarter, following the 1% growth in Q1, whereas year-on-year progress was recorded at 19.3%. Six out of 10 industries recorded progress, with transport, trade and personal providers producing probably the most notable performances.

South Africa’s trade steadiness was additionally launched final week. South Africa’s present account surplus widened to R343 billion throughout the second quarter of 2021, the most important quarterly change ever recorded. The nation’s trade surplus expanded to a file excessive of R614 billion from a studying of R261 billion within the first quarter. As a ratio of GDP, the excess widened from 4.3% in Q1 to five.6% in Q2. However, it’s value noting that this was most importantly because of will increase in costs as against rising trade volumes.

Over within the developed markets, the USD strengthened towards a lot of the high 20 currencies, with the most important positive aspects being seen towards the TRY and the AUD. The Pound lost some floor towards the buck within the early rounds of final week, earlier than experiencing a sizeable correction. GBP/USD touched a low of 1.3726 after kicking off at 1.3863 on Monday. However, after a bout of USD weak spot, the GBP/USD pair closed at 1.3839, simply 0.19% decrease for the week.

This week, the United States releases two important knowledge factors. US Inflation knowledge will probably be reported on Tuesday and is predicted to stay secure at 0.3% (MoM). Furthermore, US retail gross sales knowledge, due on Thursday, is predicted to sluggish its decline to -0.7% from -1.1% (MoM). With these two occasions, any deviation from the anticipated motion may result in sudden fluctuations within the USD valuation.

This week is somewhat heavy on knowledge from the UK. The unemployment rate for July is because of be launched tomorrow after the unemployment studying of 4.7% for June. Furthermore, the UK’s August inflation rate will come due on Wednesday. Year-on-year inflation is forecasted to rise in the direction of 2.7% after the two% determine was recorded final month. Retail gross sales for August are additionally scheduled to be reported on Friday after the earlier month-on-month decline of two.5%.

Locally, on the information entrance, now we have South African retail gross sales for July releasing this week. Despite the anticipated year-on-year enhance of seven.2%, retails gross sales are forecasted to say no by 0.3% (MoM). Mining manufacturing and gold manufacturing figures are additionally releasing.

Weekly market occasions

Tuesday 14 September

USD: Inflation rate (August)

GBP: Unemployment rate (July)

Wednesday 15 September

GBP: Inflation rate (August)

ZAR: Retail gross sales (July)

Thursday 16 September

USD: Retail gross sales (August)

EUR: Balance of trade (July)

Friday 17 September

GBP: Retail gross sales (August)

EUR: Inflation rate (August)

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