The South African rand takes advantage of the confusion and the risk appetite to gain against the US dollar. However, with the escalating tension in Hong Kong, the heightening US-China trade war, and the ongoing riots across America is giving a tough time for traders of the pair. However, the South African government is very much on track to reopen its economies, the optimism there is giving bears a little support. The South African rand is rallying ahead of the release of the Manufacturing PMI and the country’s total vehicle sales reports scheduled to be released later today. Last week, the South African rand lost its gaining momentum against the US dollar thanks to the mixed results from the country’s private sector credit report and trade balance for April. The South African trade balance collapsed from ZAR23.94 billion to an alarming ZAR-35.02 billion. Investors are hoping that those figures would recover along with the reopening of its economy.
Thanks for your in-depth analysis. You have a good understanding of the SA economy. However, in the long run, we can expect to see Zar lose considerable ground to Usd. The current strength might therefore represent good buy points. Your thoughts?