Strength of South African Rand Peaks, Highest in 16 Months

Strength of South African Rand Peaks, Highest in 16 Months

- The South African rand is now at its peak as it has strengthened when compared to international currencies

- Trading at R14,05 against the United States Dollar, the rand’s strength is credited to a higher yield on South African government bonds

- Moreover, the South African rand, also referred to as the ZAR, is the strongest it's been against the dollar for the first time in 16 months

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The South African Rand is at its strongest rate in over a year, as the latest media reports suggest. Trading at R14,05 to the United States dollar, the rand is also strengthening due to a higher yield on South African government bonds, according to the SABC.

Looking at other currencies, the rand is at R19.74 compared to the United Kingdom’s pound sterling; it rates at R17.70 against the Euro and R11.30 to the Australian dollar.

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The South African Rand has reached its strongest level in more than 15 months. Image: @SAReservebank/Twitter
The South African Rand has reached its strongest level in more than 15 months. Image: @SAReservebank/Twitter
Source: Instagram

On the other hand, the strength of the rand is credited mainly to a weaker dollar after the US jobs report for April was lower than expected and the unemployment rate rose to 6.1%.

The public broadcaster also has it that it remains unlikely that interest rates in the US will rise any time soon, keeping the dollar weaker, thus strengthening the rand.

However, it is mentioned that the rand is also strengthening due to a higher yield on South African government bonds compared to those in the developed world, where some bonds trade at negative yields, causing money to flow into South Africa and providing another reason for the rand to strengthen.

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Looking at commodities, gold is trading at $1 837 and platinum at $1 259 per ounce, while Brent crude oil is at $68,60 a barrel.

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Briefly News previously reported that with 2020 having marked the genesis of a new financial year, the South African rand ranking plays a significant role in determining both purchasing and selling power.

In terms of Mzansi's rand economic performance, we compared the ZAR strength in order to figure out the answer to the question, what is the strongest currency in Africa, and the position of ZAR.

Based on the 2019/20 ranking, the South African rand stably sat at position eight in the top 15 list of strongest currencies in African countries.

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Source: Briefly News

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