Commodity prices, Brexit, Trump spur rand recovery
The rand blasted through the R13/$ barrier this week for the first time in more than a year on the bumpy road to recovery
A year ago it sank to record lows of nearly R17 to the greenback, helping to pull the trigger on a cumulative 75 basis point interest rate increase by the Reserve Bank as a pre-emptive attempt to rein in inflation. But since then, the rand has recovered ground substantially, and not only against the dollar but also against the euro and pound - although the latter currencies are also under pressure from political uncertainty in the EU, most notably because of Brexit. The rand's improving fortunes have partially tracked the steady recovery of commodity prices, although the receding perception of political risk in South Africa has also boosted momentum. South Africa generates significant foreign exchange earnings through exports of commodities such as iron ore, the price of which has rallied from a low of $38 (about R498) a ton in 2015 to $92 a ton this week. "It does appear that firmer commodity prices are helping the rand, but the overall investment climate has become a lot more favo...
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