Rand recovers slightly despite poor global backdrop
The rand is the most sensitive emerging-market currency in the world, Devin Shutte, head of investments at The Robert Group, tweeted
The rand was relatively calm in midmorning trade on Monday, strengthening slightly against the dollar, off a very low base. The fortunes of the local currency were tied to unpredictable global markets. The fear of a trade war continues to cast a shadow on global markets. "The rand is the most sensitive [emerging-market] currency in the world. [It is] used as a proxy in risk-on/off trade," tweeted Devin Shutte, head of investments at The Robert Group. "As a result it trades a massive 18% of SA GDP in daily forex turnover (while SA trade is less than 1% of global trade volume). Explains why external factors often outweigh fundamentals." The US has threatened to impose another $200bn worth of tariffs on Chinese goods, upping the ante in a trade dispute between the two largest economies. Previously, both countries have imposed $50bn worth of tariffs on each other’s goods. The rand has been caught in the middle of the trade furore, though weak domestic data has also added pressure to the...
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