British Pound to South African Rand (GBP/ZAR) Exchange Rate Sheds 0.3% in Quiet News Day
A slight softening of the US Dollar on Tuesday has enabled emerging market currencies, such as the South African Rand, to make gains. A rise in commodity prices has also aided the Rand after raw materials rebounded from record lows. Meanwhile the Pound is struggling against the fallout of trader profit locking and yet more negative Eurozone data.
If you're looking to make an international money transfer, we recommend TorFX.
The Pound Sterling to South African Rand exchange rate is currently trending in the region of 18.2070.
Monday saw the Pound decline against the majority of its most traded currency competitors after traders opted to lock in the profits from the surge following the Unionist victory in the Scottish independence referendum.
The South African Rand, like so many other emerging market currencies, has had to battle against a bullish US Dollar. The Federal Reserve’s outlook on monetary policy was seen as being slightly more hawkish than usual when they said they expected rate revisions to occur in springtime 2015. This made the possibility of long term investment in the US Dollar very attractive, and the ‘Greenback’ (USD) surged as a result.
The Pound Sterling to South African Rand exchange rate has hit a low today of 18.1140.
Tuesday has seen the Pound extend the losses from trader profit buying and mostly negative data results. Loans for House Purchases data was forecast to rise from the previous figure of 42715 to 42913, but the actual data declined to 41588. Public Finances managed to improve upon the previous figure of -7.2 billion with Augusts’ figure hitting 1.6 billion, although this was still well below the market consensus of a rise to 6.0 billion. The Public Sector Net Borrowing dataall printed disappointingly having risen above the previous figures.
Eurozone data on Tuesday has only aided to the Pound’s downtrend. The Eurozone Composite PMI was forecast to fall in line with the previous figure of 52.5 but the actual data fell to 52.3. The Manufacturing PMI also declined beyond the median market consensus of a dip from 50.7 to 50.6, with the actual data hitting 50.5. The Services PMI emulated the other PMI’s in terms of declining beyond expectations. Services were forecast to drop from 53.1 to 53.0, but the actual data showed a further fall to 52.3.
An absence of domestic economic data hasn’t halted the South African Rand’s fractional gains against several of its currency peers. This can be attributed to a slightly weaker US Dollar. Federal Reserve Bank of Minneapolis President Narayana Kocherlakota said policy makers should improve communications. ‘The time is right to consider sharpening the FOMC’s statement of its objectives,’ Kocherlakota said in his address to the Economic Club of Marquette County.
US Dollar softening can also be attributed to Federal Reserve Bank of New York President William Dudley who stated that current conditions of low inflation and a jobs market still in recovery argue in favour of being ‘patient’ with monetary policy.
The South African Rand has also gained a boost from Chinese manufacturing data which has sent the price of raw materials and other such commodities on the road to recovery. Having moved away from the 50.0 mark that separates growth from contraction; economists predict that the Chinese demand for commodities will continue to accelerate.
The Pound Sterling to South African Rand exchange rate has reached a high today of 18.2930.
With economic reports for both the UK and South Africa lacking today, the Pound to South African Rand exchange rate may trade in a narrow range.
The GBP/ZAR pairing shed 0.3% as investors ditched the Pound following yesterday’s public finance figures. With the Scottish referendum behind us, it had been hoped that the Bank of England’s rate policy and UK fundamentals would resume driving Sterling movement. However, the situation in Syria has created a risk-off environment which isn’t serving the Pound particularly well.
Tomorrow British Pound to South African Rand exchange rate movement could be dictated by South Africa’s Producer Price Index and Bank of England Governor Mark Carney’s speech in Wales.