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USD/ZAR Probes Weekly High as USD Volatility Continues

SOUTH AFRICA
  • USD/ZAR trades +0.49% higher this morning, mirroring choppy price action in the BBDXY as markets digest yesterday’s upside surprise in US CPI.
  • On the local front we have mining data due in the first half of the session, followed by the main event – US PPI in the afternoon.
  • Global risk sentiment and the USD remain in charge of price action in the cross, with the prior highs at 16.2706 looking vulnerable on additional USD strength.
  • Upside pressure in the cross is also reinforcing the case for a +50bp hike at the SARB meeting next week with 1x4FRA-Jiba3m spreads holding in the +45-48bp range.
  • USD strength also continues to weigh on SA’s terms of trade. Intraday Sup1: 16.0808, Sup2: 16.005, Res1: 16.2706, Res2: 16.3668
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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