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USD/ZAR Rallies Sharply as Report Suggests ANC Could Change SARB Mandate
- USD/ZAR rallies sharply as Bloomberg report that the ANC want to change the SARB's mandate and are to seek a constitutional amendment. The piece quotes ANC chairman Mantashe, who argues that "The mandate of the Reserve Bank has to be expanded to meet the needs of the economy".
- USD/ZAR immediately spikes on the report, with the pair rallying to touch 17.3994 and extend recent outperformance. The bulk of the rally comes as the market clearly buying into the view that a mandate change would result in pressure on the bank for slower rate hikes / a lower peak rate.
- Recall the draft policy proposals published yesterday included a pledge to "reaffirm SARB independence". Unclear whether that clashes with this element of the story:
- "Godongwana may alternately seek to appease members of his party by stressing the need for flexibility in policy making to Reserve Bank Governor Lesetja Kganyago."
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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.