Currency outlook for the week ahead and foreign portfolio flows:
The rand has been fragile this week on the back of a strong lift in the greenback, following rising US treasury yields. It fell to its weakest level in around four months on Wednesday, closing at R12.70/USD. It did however manage to recover some ground on Thursday, along with other emerging currencies, after the Fed left rates unchanged, indicating a more gradual hiking cycle. At the time of writing the domestic currency was trading at R12.62/USD, having lost some ground on Friday ahead of the release of US non-farm payroll data.
In the week ahead, the rand is expected to trade in a range of R12.12/USD – R13.12/USD, R14.60/EUR - R15.60/EUR and R16.63/GBP - R17.63GBP.
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