North Korea defied the international community on Tuesday after it carried its third nuclear test in what it claims to be preparation to defend itself from the United States and its Allies. As a result of the test commodity based currencies around the world weakened.
The South African Rand and other commodity based currencies all weakened as a result of the test due to investors seeking safer havens. Against the US Dollar the African currency fell to its lowest level in a week.
“It just shows the failure of diplomacy and the continuation of the old broken-record story, the game of cat- and-mouse where North Korea is trying to intimidate its neighbours and the neighbours are trying to push for more deterrents and an escalation of tensions is inevitable,” said Leonid Petrov, a North Korean analyst and associate researcher at the Australian National University in Canberra.
The test comes just weeks after the United Nations increased its sanctions against the communist nation and reinforces the belief that Kim Jong Un is set to carry on in the same manner that his father did in his attempts to solidify his position as leader.
The Rand was also weakened before the release of data that may show retail sales in South Africa slowed, adding to concerns that growth in Africa’s biggest economy is stalling. So far this year the nation’s economy has been hit by worker riots and political uncertainty and remains volatile to wider international factors.
Tomorrow’s report for Retail sales is expected to show that growth slowed to 1.6% in the year through to December, down from 3.4% in the previous month.
Current ZAR Exchange Rates
The South African Rand to Euro exchange rate is currently trading at 0.0831
The South African Rand to US Dollar exchange rate is currently trading at 0.1112
The South African Rand to Pound Sterling exchange rate is currently trading at 0.0713
The South African Rand to Australian Dollar exchange rate is currently trading at 0.1086
The South African Rand to New Zealand Dollar exchange rate is currently trading at 0.1333
The South African Rand to Canadian Dollar exchange rate is currently trading at 0.1121
The South African Rand to Emirati Dirham exchange rate is currently trading at 0.4085
The South African Rand to Swiss Franc is currently trading at 0.1021
The South African Rand to Japanese Yen is currently trading at 10.4580
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