Good day, hope you all had a stellar trading week. Apologies if my charts do not show up. Hopefully today will be different
Well Trump is the president elect, markets were haywire and the world is in limbo. The Rand did as most expected and tumbled its way to 3 week lows.
Most of the losses in the rand were due to the ascension of Trump. The rand lost as it went from a low of 13.16 to the dollar to a high of 14.46. Very worrying.
There was a motion of no confidence as well which did not help the case of the culprit. Political parties called for a motion of no confidence on Pres. Jacob Zuma as they were trying to get him to step down. This motion was as always not acknowledged and therefore it became a notion of no hope. Bad news begets bad results as that motion caused the rand to spike as well.
There werent too many economic news released but the few that were release were good news but the major events just overshadowed what should have been a good week for the Rand:
– Business confidence: Up from 90.3 to 93 points. This indicates that more South African consumers and businesses are confident with goods and services in the country.
– Gold production(YoY): Up from -8.4% to -7.0%. Very important as Rand strength comes primarily from Gold.
– Mining production: Up from 0.1% to 3.4%. This means production in the mining sector is growing and getting stronger. This should deliver more natural goods and help boost the economy.
– Manufacturing Production (MoM): Up from -1% to 1.5%. A continued rise in manufacturing in South Africa. More businesses are making goods and this will provide more exports which will assist in helping boost the economy.
Well even though there were some positive news, the major events that occurred during the week seriously overshadowed the rand and puts the Culprit at serious risk of a major ratings downgrade.
My bias is bearish on Rand… Long road to freedom for this fallen currency