ZAR: Rand Ticks Higher Despite Deterioration In S&P Global PMI

USD/ZAR remains in consolidation phase in a narrow corridor between 18.5-19.0, cementing gains registered into the end of the year. While keeping this tight range, the pair has traded on a slightly heavier footing over the past few days, shedding over 650 pips this morning. The rate last sits at 18.6572 and bears need a dip through 18.5 before setting their sights on the 200-DMA at 18.1594. Conversely, the round figure of 19.0 and Jun 6 high of 19.0054 draw bullish attention. The BBDXY Index operates 0.2% shy of neutral levels, which has facilitated the downtick in USD/ZAR.

• South Africa's S&P Global PMI weakened to 49.9 (contractionary territory) in December from 50.9 prior. Accompanying commentary noted that "the South African economy may have lost a little bit of steam at the end of 2024." Still, "the final quarter of 2024 was an encouraging one for businesses on the whole." In addition, "inflation metrics, despite rising, are still comfortably below their long-run trend levels, and there is little at present to imply these will pick up sharply in the near term."
• SAGB yields have edged higher across the curve, with 10-year breakeven inflation rate last seen at 5.38%.
• The composite BBG Commodity Index has added 0.5%; the precious metals subindex is down 0.4%.