Rand Sinks Amid Greenback Outpeformance

Solid gains for the greenback have driven spot USD/ZAR higher this morning, with the pair last dealing at 19.0747, up ~1,650 pips on the session. The next target on the topside is provided by 19.3899, which capped gains on Feb 23. Conversely, bears look for losses towards Mar 13 low of 18.5066.

• The greenback has drawn support from comments from Fed's Waller, who called recent inflation report "disappointing" and said that there is no rush to cut interest rates, adding that this would require "at least a couple of months of better inflation data."
• The SARB delivered an expected hawkish hold yesterday, with the Committee unanimously backing the decision to keep interest rates unchanged. Policymakers flagged a sense of concern with an uptick in inflation, which translated into the later projected return to the target mid-point.
• South African opposition leader John Steenhuisen ruled out a coalition of his Democratic Alliance (DA) with the African National Congress (ANC), pointing to the need to avoid "having the same people who are responsible for the economic crisis, the social crisis, and the infrastructure crisis sitting around the table."
• The commodity space has been stable this morning, with precious metals generally operating in familiar ranges. SAGB yields have moved higher, with 10-year breakeven inflation rate hitting new cycle highs at 7.03%.