Rand Garners Strength Despite Escalation Of Loadshedding

The rand keeps powering ahead as Fed repricing has offered some reprieve to the wider EM FX space, despite negative Eskom headlines doing the rounds this morning. The collapse of an emerging double bottom pattern in USD/ZAR may have attracted technically-oriented participants, prompting the rate to extend its recent sell-off and swing to a monthly loss.

• On the energy front, Eskom escalated loadshedding again and will alternate between Stage 5 and Stage 6 power cuts until Saturday morning, despite earlier assurances from government officials. Separately, ANC Secretary General Mbalula walked back on his earlier claims that loadshedding could be ended by the end of this year, albeit admittedly they had been perceived as unrealistic.
• 10-year SAGB yield probed the water below the 11.5% mark this morning and hovers just above its worst levels since May, with local FI space showing some strength over the past couple of days.
• Spot USD/ZAR last deals at 18.5222, around 800 pips below neutral levels. The low print of Nov 15 provides the initial bearish target at 18.1117. Bulls look for a rebound towards Nov 24 high of 18.9570.
• The South African Reserve Bank (SARB) will release the second edition of its its Financial Stability Review for 2023 at 14:00GMT/16:00SAST at the biannual Financial Stability Forum.