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USD/ZAR Fails to Hold 13.60, Despite Positive Developments - Eyes FOMC This Week

SOUTH AFRICA
  • USD/ZAR opens flat to higher this morning, mirroring price action in the BBDXY.
  • Buying pressure re-emerged in the cross on Friday as price action failed to hold below 13.60.
  • A number of positive factors including strong GDP and energy sector reform fell short of delivering additional bearish momentum in the cross, showing potential signs of fatigue to the downside.
  • Focus this week will be on the deteriorating Covid situation on the ground and the possibility of tighter lockdown measures as cases fluctuate in the 7-10k range.
  • Markets will also be monitoring risks to the vaccine rollout from contagion risks at J&J to having recently lost HealthMin Mkhize amid a corruption investigation. Beyond this, we have limited data on the agenda outside of Retail Sales – expected to tick up.
  • The big-ticket item will be the Fed meeting, with USD/ZAR needing more dollar side weakness to sustain downside momentum.
  • Intraday Sup1: 13.678, Sup2: 13.6063, Res1: 13.7675, Res2: 13.8163
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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