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USD/ZAR Flirts With 200, 50DMAs After -4.97% Pullback from Aug Highs

SOUTH AFRICA
  • USD/ZAR trades -0.40% this morning, mirroring early weakness in the BBDXY.
  • The cross has made a notable recovery (-4.97%) after peaking at 15.40 on 20 August, and is now retesting the 200 & 50 dmas after failing to close below in yesterday's session.
  • Discussion of the new C.1.2 Variant is a noteworthy development that will likely hamper SA's tourism season, but has yet to see a major effect on case numbers or local restrictions.
  • Trade balance data due today is expected to show a softening in SA's attractive terms of trade, but still remain relatively robust.
  • Eskom's report with SCOPA will be important to gauge for progress on key milestones like unbundling, debt reduction, profitability and the load-shedding outlook following the Medupi plant explosion.
  • Momentum in USD/ZAR remains bearish, aided by USD-side weakness. However, we will need to see a consolidated close below the 200 & 50dmas for the cross to push lower.
  • 14.50 should also be relatively sticky in the near-term. Intraday Sup1: 14.5753, Sup2: 14.5052, Res1: 14.6978. Res2: 14.7583
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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