GBP ZAR has started this week’s session once again oscillating either side of 12.60.
Foreign Currency Market Update – GBP / ZAR Update
Last week saw indecision grip the GBP ZAR market, as investors struggled to decide which of two relatively weak currencies they wished to hold. This caused the pair to trade within a tight trading range either side of the 12.60 level.
The weekly high came in the early hours of Thursday morning, when GBP ZAR broke to 12.6982, as Sterling basked in the glory of strong UK employment and retail sales numbers released the week before. The move higher for the pair was accentuated by the prevailing ‘risk-off’ trading environment which was triggered by political uncertainty in France and The Netherlands. This triggered a general shift out of risk-laden currencies by institutional investors, caused downside pressure on the Rand.
If Wednesday’s initial UK GDP growth data for the first quarter of 2012 had been stronger, then GBP ZAR would surely have made a run at its 16-week high of 12.8033, which it last reached in the second week of April. As it happened, the GDP number revealed that the British economy had unexpectedly slipped into a double-dip recession, causing a move out of Sterling-denominated assets.
GBP ZAR has started this week’s session once again oscillating either side of 12.60. The longer the pair stays below last month’s 12.8033 level, the more likely it is to remain below this level. However, any deterioration in the eurozone’s ongoing debt situation could spark a move higher, bringing 12.8033 into view once more. Conversely, if Friday’s closely-watched US Non-Farm Payrolls data exceeds expectations and shows that more than the anticipated 165,000 new jobs were created in America’s vast economy last month, then the Rand could stage a comeback, with mid-April’s near-term low of 12.4021 becoming a realistic near-term target.
Summary of major upcoming data releases that we think may move the market.
- Pound to South African Rand Exchange Rate Forecast – Sterling spent the early part of last week firmly in the ascendency against the South African Rand
- Pound to South African Rand Exchange Rate Forecast – The South African Rand began last week’s session in go-ahead mood
- Pound to South African Rand Exchange Rate Forecast – The South African Rand has been battered in the markets over the past four weeks
- Pound Sterling to South African Rand Foreign Currency Exchange Rate Forecast – Rand up on Record Gold Prices
- South African Rand Foreign Currency Exchange Rate Forecast – Sterling in freefall against strong Rand…