The South African rand crossed 16 against the USD, the lowest since June 14th, pressured by severe power cuts in the country, as state-owned Eskom contends with multiple plant breakdowns due to labour protests over wages. At the same time, the dollar firmed as investors anticipate that aggressive tightening by major central banks to curb runaway inflation will continue, despite recession risks. Domestically, South Africa’s higher-than-expected inflation data in June points to a further interest rate hike in July, but there is still some uncertainty about how much the central bank will hike. The South African Reserve Bank last month unveiled its biggest rate increase in more than six years and signaled further rate hikes in the context of the gradual policy normalization.
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Historically, the South African Rand reached an all time high of 19.35 in April of 2020. South African Rand - data, forecasts, historical chart - was last updated on June of 2022.
The South African Rand is expected to trade at 16.19 by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate it to trade at 17.43 in 12 months time.