Rand’s strength welcomed as good news

 

Economist, Dawie Roodt, says the rand strengthening against the US dollar shows optimism from investors.

The rand today broke through the R18 to the dollar mark, ahead of President Cyril Ramaphosa’s inauguration.

It was at R17.93 to the dollar earlier this morning, a level last seen at the start of August last year.

This comes at a time where the country also ushers in the Government of National Unity (GNU).

Roodt says the strengthening of South Africa’s currency at the back of the changes shows that investors, internationally and locally, have confidence in the country.

He says this will also be good for inflation and interest rate, which is currently at 8.25%.

Business Unity SA CEO, Cas Coovadia, says a strong rand is a good thing and the business sector now needs to work with the GNU to stabilise the economy.

Coovadia has also urged President Ramaphosa to consider a trimmed down cabinet for the 7th administration.

Meanwhile, Statistics South Africa has announced that the consumer inflation for May remained unchanged at 5.2% year on year from April.

This was in line with analysts’ forecasts.

Stats SA says the main contributors to the rate were housing and utilities, miscellaneous goods and services, transport and food and non-alcoholic beverages.

Chief Director for Price Statistics Patrick Kelly elaborates on the news.

Interesting Economics in SA. The Local Currency/Rand has gained positively for the whole week since the pronounced GNU, now trading around R18 /1$, lowest it has attained in a long time. The confidence in the GNU has already posted positivity in the money markets.

— MAGEDON (@MAGEDON_f) June 19, 2024

BREAKING NEWS: GNU winning outcome.

Rand trading at 17.92 to $. FTSE/JSE on all time high. SA $ bonds posting huge gains.

— Digger (@markback) June 19, 2024

If I was ignorant, the hope w’d have made me belive it w’d become much more stronger, at R10 per Dollar. But I know that with the implementation of EFF Manifesto, Rand was destined to stronger against the dollar. Within 12 months it c’d go under R10 against the Dollar. https://t.co/9y1QIzxPTo

— Sithole Musa (@SitholeMusa2) June 19, 2024

Let the rand be R2 to the dollar, otherwise please stop annoying us bandla. ✋🏽

— Ntokozo Mbanjwa (@ntokozowise) June 19, 2024

The outlook for the Rand is promising with the US going to the polls. Being aware that Trump is pro stock market and crypto currencies of late. This will weigh on the dollar. I will be happy if we can go below Covid levels. Hopefully.

— Chart Professor (@Topsie1980) June 19, 2024

Have you wondered how the #Rand will perform with the new South African government coalition?

Will South Africans feel the power of a strong #ZAR

Things are looking VERY OPTIMISTIC!

R12 to a dollar in the next few years?
#southafrica #SA #USDZAR#Forex #Inauguration #GNU pic.twitter.com/erKQEUJjuR

— Connor The Trader (@ConnorTheTrader) June 19, 2024