Wild swings make rand the most unpredictable currency once again
The rand’s price swings have been the widest among 24 of its peers in the past week as risk assets have been rocked
The rand is reasserting itself as the wild child of emerging markets. The currency’s price swings have been the widest among 24 of its peers in the past week as risk assets have been rocked by everything from concern over the US-China trade dispute to Britain’s Brexit confusion. In that time, the rand has shed 3.5% against the dollar.
The rand is also climbing back up the implied volatility ladder. After being overtaken by Turkey’s lira in May, the rand’s one-week implied volatility against the dollar is now a hair’s breadth away from regaining the top spot. Its expected price swings briefly surpassed the lira’s on November 28 before dropping back again. The rand climbed to a three-year high against the dollar in February before giving up its gains to slump 13% in 2018 as domestic political turmoil, liquidity and debt problems at state-owned companies, and stagnant economic growth added to global headwinds. After falling 1.6% on Monday, it gained 0.5% on Tuesday to R14.3167/$ ...
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