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USD/ZAR Drifts Below 14.20 - Wage Negotiations, NEC Outcomes Eyed

SOUTH AFRICA
  • USD/ZAR trades -0.64% at the open on the back of early weakness in the BBDXY.
  • The cross remained mostly flat in yesterday's session, despite decent demand for SAGBs as covid and political concerns kept ZAR bulls tentative.
  • Zuma & the NEC taking the spotlight today as the deadline for his arrest draw nearer. The NEC showed little sympathy for his appeal, and analysts are doubtful that he will avoid jail time.
  • However, with decent protection surrounding his Nkandla residence, efforts to secure his arrest may result in violence with supporters and continued political turbulence.
  • Union discussions with Govt over the latest wage deal will also be eyed today, with many saying unions are feeling the pressure to accept a deal, given limited room for Govt to maneuvre any further constraints and limited appetite for a major strike that may result in an even weaker position for jobs and wages.
  • Gauteng showing tentative signs of a peak in infections overnight, but with neighbouring regions accelerating the covid situation seems far from improving.
  • Commodity prices gaining some bullish traction in recent sessions: gold +0.77%, platinum +1.10%.
  • Intraday Sup1: 14.1421, Sup2: 14.0768, Res1: 14.2277, Res2: 14.3677
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com

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