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Rand Slightly Softer, S. African Yields Climb After SONA


USD/ZAR has edged higher, as the dust settles after President Ramaphosa's SONA. The rate last changes hands at ZAR17.7800, up ~420 pips on the day, struggling to break above weekly highs. A clearance of Feb 8 high of ZAR17.8276 would expose Dec 1 high of ZAR17.9596. Conversely, bears see Feb 2 low of ZAR16.9317 as their initial target.

  • The BBG Commodity Index has added ~0.5% so far as the broader commodity complex firms. However, gains have been driven chiefly by energy resources, while the precious metals subindex is on the defensive.
  • Local-currency bond yields have advanced from the off. The move has been attributed to the declaration of a state of disaster over the ongoing energy crisis, with market participants assessing the implications for fiscal spending.
  • There are no major local data releases today, with the focus turning to next Wednesday's January CPI & December retail sales.

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