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USD/ZAR Moves Away From Session Lows Amid Greenback Recovery

ZAR

USD/ZAR operates at ZAR17.1485 up ~670 pips on the day, as recovery in the BBDXY index has dragged the pair off session lows. The Rand remains vulnerable to the risk-off impetus generated by worrying COVID-19 numbers and pockets of social backlash against tough restrictions in China.

  • Despite the move higher in USD/ZAR over the past couple of days, our technical analyst notes that the outlook remains bearish following last week’s break of trendline support drawn from the Apr 13 low. The breach strengthens the current downtrend and signals scope for a continuation lower near-term.
  • South Africa's yield curve has bear steepened, with yields last seen 2.6bp-5.3bp higher. 10-year yield has generally oscillated around last Friday's high, having a brief look above that level.
  • The BBG Commodity Index has shed 1.33%. Precious metals subindex has erased earlier gains and last sits 0.12% lower on the day.

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