The South African Rand stabilised in early morning trading against the US Dollar after it snapped a 10-day losing streak. The currency remains weak however as doubts over the strength of the South African economy and labour unrest weighs heavily upon it.
The rand has found little opportunity to gain support amid quiet trade but it has been able to take a breather after taking a beating in a very volatile week of trading.
“The Rand is very quiet today after a very volatile week. London and New York are having holidays on Monday‚ which is also contributing to the quiet market. There are no major headlines to driving the currency so the Rand is just taking a breather‚” a local currency trader said.
The Rand was knocked to a four-year low against the US Dollar as the week progressed over concerns over labour unrest in South Africa’s mining sector and as the US Dollar found strong support thanks to comments made by the Federal Reserve.
The currency managed to recoup some of its losses after the South African Central Bank chose to maintain interest rates at 5.0%. The reprieve is expected to only be brief however as investors worry about possible strike actions and the growing threat to the country’s economy from a failing power grid.
“The fact that there could be more domestic industrial action today could ensure that the Rand remains on the back foot into the weekend,” Absa Capital said in a note to clients.
“Even though the rand has already weakened substantially over the past fortnight, we are still struggling to see catalysts for a sustained recovery in the local unit.”
Current South African Rand (ZAR) Exchange Rates
The South African Rand/US Dollar Exchange Rate is currently in the region of: 0.1047
The South African Rand/Euro Exchange Rate is currently in the region of: 0.0808
The South African Rand/Pound Sterling Exchange Rate is currently in the region of: 0.0693
The South African Rand/Australian Dollar Exchange Rate is currently in the region of: 0.1084
(Correct as of 12:00 pm GMT)
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