Forex - South Africa Flows: Rand underperforms on power cuts, presentation by the Department of Public Services, nationwide strike


 10:48 (GMT) 13 Feb

  [Forex Flows]

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South Africa Flows: Rand underperforms on power cuts, presentation by the Department of Public Services, nationwide strike (0101-JCVT-C01)

The rand weakened at the start of Wednesday's session, underperforming other EMEA currencies with the USD/ZAR briefly rising to 13.86 after it breached the 13.8524 resistance level. The currency was hurt by the fourth consecutive day of rotational power cuts by Eskom, aggravated by a presentation from the Department of Public Services, according to which the power utility would "cease to exist at the current trajectory by April" unless it receives the government's help as well as the nationwide strike by Cosatu in protest against job losses. We expect the rand to extend its losses in the near term due to power cuts as well as the planned strike by Cosatu in Cape Town on February 19, on the eve of the Budget Speech, with the USD/ZAR possibly surpassing the key 13.9515 resistance level.


Forex - South Africa Flows: Rand continues to weaken on Eskom power cuts


 10:21 (GMT) 12 Feb

 [Forex Flows]

The rand continued to weaken at the beginning of Tuesday's session, with the USD/ZAR temporarily rising to 13.8452 after it broke the key 13.80 resistance level. The currency suffered from the third consecutive day of rotational power cuts by Eskom, with the utility saying that it was aiming to "end load-shedding by the end of the week". We think that the rand will depreciate further in the next few days because of power cuts as well as a nationwide strike by Cosatu on Wednesday, with the USD/ZAR probably breaching the 13.8524 resistance level.


Forex - Russia Flows: Ruble hurt by the start of delayed 2018 FX purchases by the CBR, lower oil prices


 10:13 (GMT) 01 Feb

 [Forex Flows]

The ruble depreciated a bit on profit taking at the start of Friday's session after gains recorded in the previous several days, with the USD/RUB briefly rising to 65.733. The currency was hurt by the start of delayed 2018 FX purchases by the CBR on the Finance Ministry's behalf and lower oil prices after data showed that China's Caixin manufacturing PMI deteriorated for the second consecutive month in January, to a near-three-year low of 48.3 from 49.7 in December, below the consensus forecast of 49.6. We see the CBR's bigger FX purchases weighing further on the ruble in the coming week, with the USD/RUB possibly exceeding the 66.25 resistance level.


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