Sell the South African Rand says Deutsche Bank

poundsterlinglive.com

- poundsterlinglive.com | 2 months ago

The Rand has almost entirely retraced its post-election rally against a range of currencies but losses may now wrack up for longer due to a deteriorating international environment, and given President Cyril Ramaphosa must now deliver the reformist goods he's promised or risk the ire of the market.

South Africa's China-sensitive currency followed the Renmimbi lower on Friday as markets responded to signs the so-called trade war between the world's two largest economies will could become a more serious and protracted affair. The USD/CNH rate has embarked upon a steep northward hike in recent weeks, rising 4%, in response to President Donald Trump's second major offensive in the trade war and took another leg higher in the Friday session.

The USD/ZAR rate has strong positive correlation with the USD/CNH rate, largely due to strong South African economic ties with China.

read full story @poundsterlinglive.com