Compared to last Friday’s levels of R12.34/US$, the rand is little changed at R12.39/US$ at the end of this week, having depreciated by just 0.6% over the last five days. The rand remained sensitive to political newsflow and this is likely to remain the case next week when markets will digest the ANC’s January 8 statement, to be delivered tomorrow. Guidance will be sought on policy going forward, particularly in terms of fiscal policy and radical economic transformation. This week the US$ came under some pressure as the euro appreciated to a three year high after the ECB’s December minutes were interpreted as more hawkish and the formation of a coalition government in Germany.

In the week ahead, the rand is expected to trade in a range of R11.90/USD – R12.90/USD, R14.50/EUR - R15.50/EUR and R16.40/GBP - R17.40/GBP.