Currency outlook for the week ahead and foreign portfolio flows:
The domestic currency, along with most other emerging market currencies, was under pressure last week, as trade war fears continued to weigh on investor sentiment. Additionally, Moody’s Rating Agency said “(S)outh Africa’s economic growth prospects will be limited by weak business confidence while uncertainty around land and mining reforms remain a concern for investors”, further dampening the currency’s performance. The rand came very close to touching the R14.00/USD level.
At the time of writing the rand was trading at R13.80/USD, having depreciated by 19.5%, since February 2018.
In the week ahead, the rand is expected to trade in a range of R13.30 /USD – R14.30/USD, R15.60/EUR - R16.60/EUR and R17.70/GBP - R18.70/GBP.
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