The South African Rand has fallen against the US Dollar and weakened against Sterling as economists look ahead to the release of manufacturing and mining data due for release later in the week.
The Rand had recovered some ground over the weekend following the release of last Friday’s weaker-than-expected US non-farm payrolls data which saw riskier assets receive a boost. As a result the Rand strengthened by 1% against the ‘Greenback’. The data created doubt over whether the Federal Reserve would start to unwind its monetary stimulus programme as early as September.
The South African currency also received some support in early trading on Monday after the world’s second largest economy, China, posted PMI data that showed a modest expansion.
The data allayed fears over the economic health of the country which is South Africa’s biggest trading partner. The Eurozone also produced signs that it too was on track to begin a recovery in the second half of the year. The Eurozone is also one of South Africa’s biggest trading partners.
“Emerging market economies remain under pressure while there are growing signs that developed economies are on firmer ground, Last week’s much stronger than expected PMI data from the US and falling unemployment in the Eurozone were further reminders of this development,” economists at Rand Merchant Bank wrote in a note.
As Thursday approaches the Rand is likely to come under further pressure. If local mining and manufacturing production data, released on the day, disappoint then the currency could fall further and go beyond the key R10 mark again.
Current South African (ZAR) Exchange Rates:
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The US Dollar/South African Rand Exchange Rate is currently in the region of: 9.8257 >
The Pound Sterling/South African Rand Exchange Rate is currently in the region of: 15.1013 >
The Euro/South African Rand Exchange Rate is currently in the region of: 13.0504 <
The Australian Dollar/South African Rand Exchange Rate is currently in the region of: 8.7522 <
The New Zealand Dollar/South African Rand Exchange Rate is currently in the region of 7.6479 <
The Canadian Dollar/South African Rand Exchange Rate is currently trading in the region of 9.4617 <
(Correct as of 11:30 am GMT)
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