Week Ahead: Economy is forecast to have lifted out of technical recession in Q2.17 on improved industrial and trade sector performances

21 Aug 2018

Annabel Bishop

Chief Economic

The rand is presently trading at 12.90/US$ versus 13.07/US$ at the start of the week. This appreciation has occurred despite the US$ index trading stronger into the end of the week, after having reached the lowest level since January 2015 earlier in the week.

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Better than expected US GDP data strengthened expectations of a further interest rate hike by the Fed and therefore aided the recovery in the US$ index. However worse than expected US employment data on Friday saw US$ weakness, and hence rand strength against the greenback. Geopolitical tensions eased over the course of the week and commodity prices remained relatively resilient which will have aided the appetite for riskier assets and supported gains across most emerging market currencies.
The rand is expected to trade in a range of R13.40/USD – R12.40/USD, R15.90/EUR - R14.90/EUR and R17.20/GBP - R16.20/GBP, in the week ahead.

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