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South African Reserve Bank Releases Statement, Rand Extends Surge

SARB

The South African Reserve Bank unexpectedly raised interest rates by 50bp today, while revising the inflation outlook for this year higher and flagging upside risks to that outlook.

  • The SARB has now uploaded the statement to its website. The full document can be found under this link.
  • The impact of the hawkish surprise from the SARB is reverberating across local markets:
    • USD/ZAR has crossed firmly below its 50-DMA and ZAR18.00 figure to last trade at ZAR17.7812, with the Rand sitting atop Bloomberg's expanded list of 31 major currencies.
    • South Africa's FRA curve adjusted higher, with 1x4 FRA vs. 3-Month JIBAR spread widening to 34bp.

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