The South African rand experienced a significant setback on Thursday, plunging to its lowest point in four months, amidst growing concerns about the currency’s vulnerability. Investors are eagerly anticipating signals from upcoming U.S. employment data scheduled for release on Friday.
As of 1505 GMT, the rand was trading at 19.5700 against the U.S. dollar, reflecting a drop of nearly 1.2 percent compared to its previous closing rate. Earlier in the day, it reached 19.6325, marking its lowest level since June. In contrast, the U.S. dollar demonstrated a slight weakening of approximately 0.15 percent when measured against a basket of global currencies.
According to Danny Greeff, Co-Head of Africa at ETM Analytics, who was quoted by Reuters, “Given South Africa’s heightened fiscal risks and deteriorating economic fundamentals, the ZAR lacks resilience against the broader ebb and flow of market sentiment.” He emphasized the significance of the impending U.S. employment data, highlighting its potential to influence the rand’s trajectory in the coming week.
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