Rand – US Dollar Update … Light at the end of the Tunnel?

veryone is monitoring the Rand – US Dollar exchange rates and whether or not there is any light at the end of the tunnel. Well, SasFin puts it this way:

h3. US Dollar

Although a shortened week, it will be a busy one ahead with some important developments both local and international scheduled for release. Out of the US, it will be with great interest to look out for Feb Chair Yellen’s commentary later today for clearer guidance on whether the Fed can indeed afford to be as hawkish as some of the Fed speakers have sounded recently. The USD has already retreated slightly off its highs and the expectation is that any further downscaling of rate hike expectations will weigh on the USD.

h3. SA Rand

Domestically, it is a shortened week but it is also a very busy one packed with data releases including money supply and credit data, government finance and trade figures, PPI, the PMI and vehicle sales. Overall, starting with this evening, the week ahead could be a more positive one for the ZAR, political developments notwithstanding. Even on that front however, it has been encouraging to see various organs of state kick into action with regards to investigations of state capture. If nothing else, this issue has become such a prominent one that the ANC and government officials will not be allowed to ignore it or to sweep it under the carpet. The pressure is building all the time for changes to be rung in the upper echelons of government and if Brazil has taught us anything, it is that this pressure can yield the desired result if it ramps up high enough which itself would be ZAR supportive just as it was with the Brazilian Real.

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