EDITORIAL: New tests of rand buoyancy
Trumponomics will weigh heavily on global markets — but the rand’s ups and downs in 2017 could be driven as much by our own foibles as by global geopolitical ones
A year-end happy holiday message from Rand Merchant Bank’s currency team hailed the fact that 2016 was the first year of rand gains since 2010, with the currency ending the year as the third best performing in global markets. SA’s ultravolatile currency appreciated 13% against the dollar, entering the new year at about R13.74 and recorded what the bank says was its "biggest ever" gain against pound sterling, trading early on Monday at about R16.95. After the political roller-coaster that was 2016, it seems quite startling that SA’s currency could have performed so strongly. With 2017 set to be another rough-ride year, globally and domestically, it’s anyone’s bet where the rand could go. But at least it is not by any means a one-way bet. Global drivers will loom large this year and for all currencies one of the largest, if not the largest driver, will be the new administration of Donald Trump and how it plays out in US economic policy. Markets will be trying to assess the direct effe...
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