Bearish signs are stacking up for the rand: volatility and the cost of protecting against a weakening currency are increasing, short positioning is soaring and foreigners are fleeing South African bonds at a rate last seen 18 years ago. After outperforming emerging-market peers for much of 2018 thus far, the rand is falling into line as rising US treasury yields spark dollar strength, dampening demand for riskier assets. The rand is down 5.6% against the dollar over the past month, and more pain is in store as the currency resumes its mantle as one of the most volatile in developing nations, according to strategists at Nedbank. "Our view for a weaker rand is now materialising, but we must admit that we are surprised by the speed at which it is taking place," Nedbank’s Mehul Daya said. "We expect the trend to continue as the year progresses." The rand slipped 0.3% to R12.8077 per dollar by 12.24pm, a third day of losses. Nedbank has forecasted that the currency will sit at R13/$ by y...
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