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Rand In Retreat As Local Yields Tick Off Lows, Commodity Space Strength Moderates

ZAR

Spot USD/ZAR is gaining altitude, with commodities losing some strength and local-currency bond yields ticking off lows. The upswing in the rate has outpaced the parallel uptick in the BBDXY index, with USD/ZAR printing two-month highs as a result. The pair last operates at ZAR17.7330, approaching resistance from Dec 13 high of ZAR17.7601.

  • Commodity complex strength has moderated, with the BCOM Index trimming its initial gains. The precious metals subindex is also struggling to re-test session highs.
  • Local-currency bonds have eased off session highs, with South Africa's 10-year inflation breakeven rate last seen at 5.99%.
  • Looking ahead, all eyes are on President Cyril Ramaphosa's State of the Nation Address, due at 19:00SAST on Thursday. Contrary to earlier expectations, the widely touted Cabinet reshuffle may take place after the speech.
  • On the data front, mining & manufacturing production figures will hit the wires tomorrow morning.

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