Rand Keeps Rallying With South African Markets Shut

The rand has been riding the wave of a dovish shift in global sentiment, largely stemming from the rhetoric deployed alongside the Fed's rate decision earlier this week. Spot USD/ZAR has shed 4% this week and the rand occupies the top spot in the EMEA FX performance table, with the pair last changing hands at 18.1973.

• From a technical point of view, the next bearish target is provided by 18.1117, which limited losses on Nov 15. On the topside, the key near-term resistance has been defined at 19.1386, the high print of Dec 11.
• A set of weak activity data released overnight out of China, the top buyer of South African commodities, has failed to weigh on the rand to any significant degree. While industrial output and retail sales improved, analysts commented that this was due to a favourable comparative base from a year ago when China was implementing its COVID-19 containment policies.
• South African markets are closed for a public holiday to celebrate the national team's victory in the Rugby World Cup, with the rand facing increased exposure to external factors and trading in thinner liquidity conditions as a result.