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Rand Treads Water, Looks For New Catalysts

ZAR

USD/ZAR continues to respect its recent range, looking for fresh catalysts that could give it some directionality. The pair operates at 18.9855, a touch higher on the session. A clearance of Oct 6 high of 19.6399 would suggest that bullish momentum is picking up. Bears see Sep 20 low of 18.6825 as their initial target.

  • The rand has shown a muted reaction to the news that SARB Deputy Governor Kuben Naidoo, perceived as a slightly dovish-leaning policymaker, has tendered his resignation. The central bank and the presidency are yet to provide any details around and/or timeline for succession.
  • The BBG Commodity Index sits ~0.2% lower on the day, with the precious metals subindex down ~0.1%.
  • SAGB yields are lower, curve runs steeper as we type. South Africa's 10-year breakeven inflation rate printed new cyclical lows at 6.91%.
  • South Africa's leading indicator ticked higher to 110.9 in August from 110.4 prior, with the release causing no tangible market reaction.

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