The South African rand had a comparatively uneventful buying and selling week, as current volatility has subsided. The absence of a major world catalyst left the market with out a definitive path.
The solely notable South African information final week was the September retail gross sales development. Retail gross sales declined by 0.60% (YoY), after the two.1% development within the earlier month. This studying was decrease than anticipated, including weight to the ZAR.
The US retail gross sales development was launched on Wednesday. Retail gross sales elevated by 1.3%, marginally outperforming expectations. US producer value index (PPI) information was additionally launched and elevated by 0.2%. However, this studying was decrease than the 0.4% forecast, and would possibly trace on the slowing of forward-looking inflation.
The UK had an energetic information week
The UK had an energetic information week, together with the employment, inflation, and retail gross sales information being launched. The UK Finance Minister, Jeremy Hunt, additionally delivered his Autumn Budget Statement. The plan revealed a number of spending cuts, coupled with a number of tax will increase geared toward bettering the well being of the nation’s fiscal place.
The UK’s inflation fee was reported at 11.1% in October, up from 10.1% within the prior month. This was increased than anticipated, with many of the value strain arising from gasoline and electrical energy. Additionally, the UK’s unemployment fee got here in at 3.6% for September, consistent with market expectations. This was marginally increased than the earlier 3.5% studying.
The Dollar Index (DXY) recovered 0.60% final week, after taking a big tumble. This can largely be attributed to positive factors in opposition to the EUR and the Japanese Yen (JPY). However, the US Dollar misplaced some floor in opposition to the sterling, with USD/GBP depreciating by 0.40%.
USD/ZAR moved sideways all through the buying and selling rounds
The South African Rand yielded a blended efficiency within the foreign exchange markets final week. USD/ZAR moved sideways all through the buying and selling rounds, from an open of R17.24. The pair remained between R17.10 and R17.55, earlier than closing the week again on the R17.24 mark.
The rising market ZAR did handle to scoop up some positive factors in opposition to the EUR and AUD. The EUR/ZAR pair depreciated by 0.30% in the course of the week, from an open of R17.85, and ended at R17.80 on Friday. AUD/ZAR additionally moved decrease by 0.48%, from an open of R11.55. The pair closed off the week at R11.50.
However, the Rand was unable to outperform the Pound, with GBP/ZAR transferring 0.39% increased. After kicking off at R17.40 and reaching a excessive of R20.76, the pair closed at R20.49.
There is a pleasant handful of native information due this week. The South African inflation fee for October shall be launched on Wednesday and is predicted to return in at 7.4%. This comes after the annual inflation fee slowed to 7.5% in September, down from August’s 7.6% studying. Price strain eased additional for transportation and fuels, though this was partially offset by increased CPI gadgets. Nevertheless, inflation stays above the South African Reserve Bank’s (SARB’s) 3% – 6% goal vary.
On Thursday, the SARB’s most up-to-date rate of interest determination shall be launched. South Africa’s central financial institution is predicted to lift rates of interest by one other 75 foundation factors, from 6.25% to 7%. This could be the seventh consecutive fee hike since November 2021, as a part of the SARB’s effort to scale back inflation down in direction of the midpoint of its goal band.
There shall be minimal world information this week. The most notable occasion would be the Federal Open Market Committee (FOMC) assembly minutes. This will present the markets with further perception into the US Federal Reserve’s financial outlook.
Upcoming market occasions
Tuesday 22 November
EUR: Consumer confidence index flash (November)
Wednesday 23 November
USD: FOMC minutes
ZAR: Inflation fee (October)
NZD: RBNZ rate of interest determination
USD: Durable items orders (October)
USD: New dwelling gross sales (October)
Thursday 24 November
ZAR: Interest fee determination
ZAR: Business confidence index (This fall)
Friday 25 November
GBP: GfK client confidence (November)
Get our Daily Rand Report delivered straight to your inbox each weekday to maintain on prime of every thing taking place with the ZAR.
Check out the Sable International Currency Zone to get the newest stay alternate charges and simply switch your cash into or out of South Africa.
