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Market Snapshot: ZAR Gains On USD Weakness, CPI Surprise

SOUTH AFRICA
  • USD/ZAR trades -1.09% lower today with ZAR gaining bullish traction on the back of a softer USD, improved risk conditions and higher CPI.
  • Retail sales printed firmer than expected at 1.9% m/m & 3.3% y/y vs 2.0% prior.
  • Dynamic support remains intact around the 100dma at 15.2838.
  • SAGBs have also trimmed early weakness with 10-30Y yields flipping to gains while 2Y yields remain underpinned at +3.1bp following CPI (5.9% y/y).
  • 9x12 FRA-Jibar3m spreads have risen after CPI to +202bp from around +150bp at the start of the year.
  • Local analysts anticipate higher oil prices to drive SA’s average CPI reading to 5.3% y/y from 4.5% y/y prior.
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com

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