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USD/ZAR Holds Below 13.80 Pre-FOMC, Covid Risks on the Rise

SOUTH AFRICA
  • USD/ZAR opens mostly flat, despite early weakness in the BBDXY – diverging slightly from the move lower in USD/CNH this morning.
  • The return of moderately tighter restrictions shouldn't impact the economy too much, with the greater concern being hospital capacity in Gauteng and the rapidly rising caseload amid a slow vaccine rollout.
  • Focus today will be on the FOMC with expectations for light mentions of tapering and the Fed's assessment of transitory price factors on the agenda.
  • USD/ZAR failed to hold above 13.80 in yesterday's sessions, but seems to have lost bearish traction somewhat with buyers keeping the cross supported above 13.60.
  • Price action now exerting pressure on the upper threshold of the long-term bear channel pattern on the daily, with 14.00 representing a break of this channel.
  • Intraday Sup1: 13.7081, Sup2: 13.6780, Res1: 13.8163, Res2: 13.8573
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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