S. African Army Chief Travels To Moscow For "Goodwill Visit"

The South African National Defence Force (SANDF) said on Monday that a delegation of generals led by army chief Lawrence Mbatha is in Moscow but played down the trip as a "goodwill visit," which "was planned well in advance." By contrast, Russia appeared to play up its strategic importance, describing it as "combat readiness talks."

• The visit of senior military officials to Moscow comes as South Africa is trying to defuse tensions with the West over its stance on the ongoing war in Ukraine. During his stay in Moscow, Mbatha is expected to visit military educational institutions, industrial sites and hold talks with high-profile Russian military officials.
• An interview with U.S. ambassador, who claimed that South Africa may have supplied weapons to Russia, sent USD/ZAR to all-time highs last week. Tensions appeared to have eased over the weekend, as Finance Minister Godongwana insisted that the U.S. will not slap sanctions on South Africa, while multiple senior officials denied the allegations.
• Still, geopolitical concerns continue to linger. BNP Paribas wrote in a research note that the SARB will raise interest rates by 50bp next week as geopolitical tensions amplify headwinds to the ZAR, with another 25bp hike likely coming up in July. They noted that "even though engagements over the weekend indicate some calm returning to diplomatic waters (...) we think that some damage has already been done to the future trade deal renegotiations."