Rand Holds Narrow Range Despite Domestic Headwinds

USD/ZAR continues to operate within a tight range after snapping a four-day losing streak yesterday. Escalating power cuts by Eskom and continued fiscal headwinds keep investors cautious, but the rand's losses have been relatively limited yesterday. A spell of USD/ZAR strength ended as the pair tested 19.0414, with a pullback in USD facilitating the pair's move away from intraday highs. When this is being typed, USD/ZAR trades at 18.9223, barely changed on the day.

• Eskom said that it will implement Stage 6 loadshedding continuously until further notice, defying earlier guidance from Electricity Minister Kgosientsho Ramokgopa, who suggested that we should see lower levels of power cuts this week.
• South African trade unions told President Cyril Ramaphosa that they will go on strike if the government presses ahead with its proposed cost-saving plan, which will be incorporated in the upcoming mini-budget.
• SAGB yields have crept higher, with 10-year breakeven inflation rate sitting at 6.81%. The aggregate BBG Commodity Index sits ~0.2% higher, with the precious metals subindex last seen ~0.2% lower.