The South African Rand has made gains against the US Dollar after the South African Central Bank governor, Gill Marcus said that the increasingly risky inflation outlook was limiting the scope for a further loosening of monetary policy. She added that so far the Rand’s depreciation on inflation has so far been constrained.
The central bank governor told a conference hosted by the Bureau for Economic Research that the reason for the muted effect was the weak pricing power in the South African economy and the poor prospect for growth.
“It could also be that the sharp moves in the exchange rate could be excessive,” she said in a prepared speech.
But the longer this persisted, the greater the risk that the relatively benign affect on inflation so far would end, she said.
The US Dollar/South African Rand Exchange Rate is currently in the region of: 9.9850
The market’s recent moves have been overstretched and we have had excessive volatility‚” a local currency trader said. “Liquidity has been dire the whole week due to a lot of uncertainty in our market and global markets. The uncertainty is caused by the possibility that quantitative easing in the US may be cut‚ and this would have a negative effect on emerging market currencies such as the Rand‚” he said.
“A lot of what Marcus said this morning she has stated before. There was nothing new in her speech. She did say the rand’s recent weakness is inflationary and that it is a concern. They think monetary policy is fine for now and Marcus is maintaining her stance‚” he said.
Current South African (ZAR) Exchange Rates
The US Dollar/South African Rand Exchange Rate is currently in the region of: 9.9850
The Pound Sterling/South African Rand Exchange Rate is currently in the region of: 15.4236
The Euro/South African Rand Exchange Rate is currently in the region of: 13.1022
The Australian Dollar/South African Rand Exchange Rate is currently in the region of: 9.4799
The New Zealand Dollar/South African Rand Exchange Rate is currently in the region of 7.9484
The Canadian Dollar/South African Rand Exchange Rate is currently trading in the region of 9.6638
(Correct as of 12:25 pm GMT)
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