Rand Extends Gains As Ramaphosa Fights For His Political Fate, Precious Metals Firm

The Rand remains the best EMEA performer with participants mulling the latest developments in the Phala Phala scandal and looking ahead to the release of Q3 GDP figures. Spot USD/ZAR trade at ZAR17.3394, down ~840 pips on the day, with bears looking for losses past Nov 30 low of ZAR16.8980 and towards Aug 25 low of ZAR16.7102. On the flip side, bulls set their sights on Dec 1 high of ZAR17.9596.

• Parliament delayed a vote on the Section 89 report until next week as President Ramaphosa decided to challenge it in the Constitutional Court. Ruling ANC's acting Secretary General said that the President hasn't offered to quit and has not been asked by the party to do so.
• USD/ZAR implied volatilities have crept higher, with overnight tenor printing its best levels in more than three weeks. Longer-dated contracts also remain elevated, albeit are off last week's cyclical highs.
• The commodity complex has lost its initial appeal and the BBG Commodity Index is back to unchanged levels. However, the precious metals subindex is up ~0.4% on the day, with gold trading on a slightly firmer footing.
• Local-currency bond yields are a tad higher, curve has steepened at the margin. South Africa 10-year inflation breakeven rate sits at 6.32%.