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Soaring Palladium, Rhodium Prices Support ZAR; GDP & Current Account Data Eyed

  • USD/ZAR trades +0.02% higher this morning, with ZAR continuing to outperform the region on the back of surging commodity prices add to its favourable terms of trade.
  • Palladium & rhodium are the notable risers, now up +74 & 51% YTD as the Ukraine crisis creates notable shortages.
  • Upside in commodities should continue to support ZAR, while also adding tightening pressures to the SARB with oil trading just shy of $130/bbl.
  • Confirmation that the US will not punish SA for its abstention at the UNGA at this point in time is a positive, but concerns remain over SA’s position of the matter.
  • GDP and current account data are in focus this week with the latter expected to narrow to 2.6% vs 3.6% prior. GS estimate SA’s FY22 surplus will narrow to 2% of GDP and remain in surplus until late 2023.
  • Volatile global risk sentiment will continue to dominate USD/ZAR price action with the cross still pegged within the 15.00-15.60 range.
  • So far, the 100dma at 15.4674 has proven resilient with sellers keeping price action below the average.
  • However, a consolidated break higher would open up 15.75-16.00 to the topside, while the 200dma below at 14.98 is the key downside support to consider this week.
  • Intraday Sup1: 15.2633, Sup2: 15.2155, Res1: 15.4435, Res2: 15.4902, Res3: 15.5630
  • Commodity prices

MNI London Bureau | +44 020-3983-7894 |
MNI London Bureau | +44 020-3983-7894 |

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