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USD/ZAR Pulls Back From its 50dma, US Data & FOMC Minutes In Focus

SOUTH AFRICA
  • USD/ZAR trades +0.22% higher this morning, tracking choppy price action in the BBDXY following yesterday’s weaker ISM data.
  • The cross turned +0.77% higher in yesterday’s session as USD strength and higher UST yields returned – driving high-beta EM FX weaker on the day.
  • Yesterday’s Zondo report represents a positive development for SA’s and Ramaphosa’s anti-corruption drive with a number damning findings for Zuma and prior SOE executives involved directly in state capture.
  • Ramaphosa’s move to open the reports immediately was a solid personal decision to reinforce his credibility and gain public support for action against those accused of corruption – which make up a number of his key detractors.
  • While no action is expected immediately, Ramaphosa’s response in enforcing punitive measures will be watched closely for a turnaround in irregular SOE expenditure and corruption.
  • On the international front, US PMI data and the FOMC minutes will be eyed for USD-side drivers.
  • Recent buying pressure above the 50dma in USD/ZAR suggests a possible continuation higher may be on the cards if the cross can clear 16.0902 (03 Jan high) – opening up 16.26-13.3668 to the topside.
  • Intraday Sup1: 15.9752, Sup2: 15.8888, Res1: 16.0902, Res2: 16.1717
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com
BulletEM BulletEmerging Market NewsHomepage
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com
BulletEM BulletEmerging Market NewsHomepage

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