South African Rand Hovers at Over 1-Month Low
The South African rand traded around 16.3 per USD, holding close to the lowest since early August, amid a firmer dollar and falling prices of key precious metals. Domestically, investors awaited August consumer inflation data and the SARB’s policy decision, both due on September 23. Inflation eased to 4.3% in July, marking its first decline in five months, from a two-year peak of 5% in June. However, it is expected to accelerate again in August following domestic diesel-price adjustments. South Africa could be heading for a 25-basis-point rate hike this week, as higher oil prices and the Fed’s latest move strengthen the case for tighter monetary policy amid renewed inflation risks. However, the decision remains uncertain, particularly after the central bank surprised markets and economists in July by keeping its repo rate unchanged at 7%. Policymakers will again face a delicate balancing act between renewed inflation pressures and weak domestic economic activity.
3 per USD, holding close to the lowest since early August, amid a firmer dollar and falling prices of key precious metals. Domestically, investors awaited August consumer inflation data and the SARB’s policy decision, both due on September 23. 3% in July, marking its first decline in five months, from a two-year peak of 5% in June. However, it is expected to accelerate again in August following domestic diesel-price adjustments.
South Africa could be heading for a 25-basis-point rate hike this week, as higher oil prices and the Fed’s latest move strengthen the case for tighter monetary policy amid renewed inflation risks. However, the decision remains uncertain, particularly after the central bank surprised markets and economists in July by keeping its repo rate unchanged at 7%. Policymakers will again face a delicate balancing act between renewed inflation pressures and weak domestic economic activity.