Rand Recoups Losses, PPI Readings Print Slightly Below Expectations

Spot USD/ZAR has trimmed the bulk of its earlier losses despite the controversy caused by an interview with Andre de Ruyter, who stepped down as Eskom CEO yesterday. The rate reduced losses as its one-month implied volatility pulled back from intraday highs. At typing, USD/ZAR deals at ZAR18.2330, some 60 pips below neutral levels.

• Bear flattening has crept into the local-currency bond space, with yields sitting lower across the curve. Benchmark FTSE/JSE Africa All Share Index has more than erased yesterday's decline and is ~1.1% better off. The commodity complex has firmed, albeit precious metals have struggled to post any notable gains.
• Earlier in the day, South Africa's PPI for January printed at +12.7% Y/Y, narrowly missing the +12.8% consensus forecast (-0.6% M/M vs. -0.4% expected).