CAPE TOWN: Pound to South African Rand exchange rate steadily rose from an opening level of 16.3919 on Monday to close higher around 16.7017 on Friday.
The only UK event of note was Tuesday’s spring statement, which saw Chancellor Philip Hammond make cautiously optimistic predictions about future UK economic growth.
There were a number of critics of the Chancellor’s outlook, but the GBP/ZAR exchange rate rise was also enabled by increasing demand for safe haven currencies like Sterling.
Throughout the week, there was increased concern about the impact that US metal tariffs would have on the global marketplace; these will be activated on 23rd March. The hitting of a major landmark in Brexit talks has boosted the Pound today, pushing Sterling up against the Rand and peers such as the US Dollar and the Euro.
Inflation levels on the year in February are predicted to have slowed, while rates of wage growth in January is expected to have increased from 2.5% to 2.6%.
Although the UK wage squeeze will remain in effect even if inflation drops to the predicted 2.8% level, the smaller gap between wages and inflation could still boost GBP demand.
For South African Rand watchers, the main data to look out for will be retail sales figures on 22nd March, which have currently been forecast positively.
If year-on-year and month-on-month sales are reported to have grown in January, the South African Rand could make a late-week recovery against the Pound.
