GBP/ZAR Exchange Rate Climbs despite High South African Business Confidence Figures
The Pound Sterling South African Rand (GBP/ZAR) exchange rate started to climb over the course of this morning, with the pairing currently sitting at interbank rate of R17.8917.
This morning saw the release of the South African business confidence index published by the Chamber of Commerce and Industry, which reported growth in November to 96.1 from the previous reading of 95.8.
Despite this positive data, it could not stop the Pound pushing back at the ZAR, climbing to the highest interbank rates in a week, at R17.9235.
GBP/ZAR Exchange Rate Continues Rally Yesterday despite Carney’s Warning of Food Price Increases in UK
The GBP/ZAR exchange rate rallied towards the latter half of yesterday with a disappointing data release from the UK doing little to hinder the Pound.
The lower-than-expected Markit services PMI printed at 50.4 for November, despite a predicted increase from the previous figure of 52.2.
Tuesday saw better PMI construction figures for the UK, rising to 53.4 from 53.2, despite a predicted fall, although this was overshadowed by the Bank of England (BoE) Governor Mark Carney’s speech.
Carney warned that in ‘the most extreme scenario, on average your shopping bill goes up by 10%’ and if there is a more orderly Brexit, he suggested this number would drop to 6%.
These statements caused the Pound to drop against the major currencies, although the GBP/ZAR exchange rate did not fall substantially.
Instead there was a lot of volatility, but ultimately it resulted in the Pound rising and clawing back the losses it had made in the first half of the week’s session.
GBP/ZAR Exchange Rate Improves Despite Strong South African GDP
Tuesday saw the release of better-than-expected South African gross domestic product (GDP) data, showing that in the third quarter, GDP grew to 2.2% from -0.4% in the second quarter.
The annualised data also revealed that South African GDP grew from 0.4% in Q3 2017 to a better-than-forecast 1.1% in Q3 of 2018.
GBP/ZAR Exchange Rate Outlook: Will the South African Rand be Able to Regain This Week’s Losses?
With Brexit looking like it is going to remain the main catalyst for movement for the Pound, there was news that the European Court of Justice will rule on whether or not the UK could potentially withdraw its notification to leave the European Union without the consent of the other member states.
This judgement is set to be released on 10 December, the day before Parliament is set to vote, which means that Sterling is likely to be volatile over the start of the session next week.
Nevertheless it was noted this morning by Brexit Secretary Stephen Barclay that the position of the government is that it ‘won’t be revoking’ it’s Article 50 notification.
Friday will see the release of the November gold and forex reserves figures for South Africa, which will reveal the amount the bank reserves in foreign currency and gold.