Week Ahead: Q2.17 retail activity expected to have lifted from Q1.17 contraction

Heightened global risk aversion linked to escalating geopolitical tensions between the US and North Korea weighed on the performance of emerging market currencies this week.  Since Monday, out of a basket of 24 emerging market currencies, only the Chinese renminbi, Chilean peso and the Thai bhat registered modest gains. The rand was the worst performer, depreciating by 1.9%. Additionally weighing on the rand were local political developments.  Specifically, the announcement on Monday that the no confidence vote against the President would be a secret ballot and the subsequent failed motion on Tuesday induced rand volatility over the course of the week.

The rand is expected to trade in a range of R13.95/USD – R12.95/USD, R16.30/EUR - R15.30/EUR and R18.00/GBP - R17.00/GBP.