South African Rand Price Forecast: USD/ZAR, GBP/ZAR,EUR/ZAR Price Setups
Rand Price Outlook:
GBP/ZAR threatens critical support Advertisement
The South African Rand (ZAR) has recently traded within a well-defined range against its major counterparts, largely buoyed by US Dollar weakness and an increase in the demand for major commodities, primarily Platinum and Gold.
Visit the DailyFX Educational Center to discover why news events are Key to Forex Fundamental Analysis
However, South Africa’s economic outlook remains a controversial topic as credit rating agencies continue to scrutinize the Emerging Market (EM), maintaining a relatively pessimistic view. Despite reporting a budget surplus, rating agency Standard & Poor (S&P) has expressed concerns over SA’s exorbitant levels of government debt, indicating that South Africa may face further downgrades in the foreseeable future.
South African Rand Dollar Price Forecast: USD/ZAR Bounces Between Key Levels
Rand Price Outlook: Advertisement
The South African Rand continues to maintain a certain degree of strength against its major counterparts despite the vaccination program lagging behind both developed and Emerging Markets (EM). Despite the recent reopening of the economy, cash strapped power utility Eskom struggles to keep the lights on, resulting in the reimplementation of load shedding (rolling blackouts), an issue that has hindered economic output for the past decade, placing the economy in a recession prior to the Coronavirus pandemic.
Visit the DailyFX Educational Center to discover why news events are Key to Forex Fundamental Analysis
South African Rand Price Forecast: USD/ZAR, GBP/ZAR,EUR/ZAR Setups
Rand Price Outlook: Advertisement
The South African Rand has strengthened against its major counterparts ensuing from the release of the second consecutive positive GDP report, further increasing investor sentiment and hopes of an economic recovery. However, the Coronavirus pandemic had exacerbated the effects of an economic recession, pushing unemployment to record highs, causing additional concern around the country’s credit rating. And given the rising level of government debt which coincides with a decrease in revenue as the annual number of South Africans emigrating abroad continues to steepen, there’s been a large burden on wealthier residents to help bridge the gap.