The Rand remained the market’s outperformer ahead of the weekend following a show of strength and resilience that could be set to persist for some time yet as it reaps the rewards of the commodity price recovery and an elevated ‘real yield’ offering to investors.
The South African Rand is at risk of being downgraded from an Emerging Market to a Developing Market currency says a noted South African economist, offering a stark warning to the country's leaders that significant reform is now required.
The Rand has seen a turbulent start to a typically-inhospitable August month but the latest forecast review from Commerzbank still suggests the South African currency can recover back to 14.0 in the coming months, and that it could hold those levels through year-end if Autumn budget risks can be successfully navigated.
The South African Rand has remained on its back foot thus far in August and could still be susceptible to a further correction over the coming weeks if the Dollar’s resurgence and global growth concerns continue to dampen commodity prices, which would risk a USD/ZAR move to 15.0 or above.
The Rand has lifted off two month lows to outperform many others early the new month, leading the Pound-to-Rand exchange rate to explore the land below 20.00 this week in price action that comes alongside an ebbing of the U.S. Dollar, although a double-edged sword now hangs above the South African currency.