BRIAN KANTOR: Who’s afraid of the big bad Trump? Not the mighty rand
Clearly investors in emerging market (EM) equities or bonds, including investors in South African equities and bonds, are less afraid. EM equities, including the JSE when measured in dollars, are enjoying a strong run, as is the rand. All have recovered well from their lows of early 2016, though are not yet back to where they were in early 2015 (see figure 1). This recovery has accelerated in 2017, as can be seen in figure 2. The rand/dollar is shown as the rand value of a dollar, rather than the other way round, to make the comparison between rand strength and EM gains more obvious. Lest we forget, when a dollar costs as little as R12.90, that in January 2015 we were paying a mere R11.55 for the opportunity. Those were the days before weaker global growth sent EM economies and their equity markets lower, and a once seemingly all-powerful President Jacob Zuma installed his man temporarily in the Ministry of Finance, making the rand so much weaker relative to other EM currencies that...
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