The rand has firmed to around R18,85 against the US dollar after earlier breaching the R19 mark.
The currency’s latest bout of weakness is attributed by some economists to expectations around US interest rate cuts next year.
Economists say the developments around the rand can also be attributed to the South Africa’s third-quarter gross domestic product (GDP) data that showed a contraction that was slightly worse than expected.
Makwe Masilela is a fund manager, “The rand has been strengthening and that’s at the back of a weakening US dollar. The reason the dollar has been weakening is that expectations are interest rate cuts have to kick in first quarter of next year boosted by the data coming through that market participants think that interest rates have to start coming down. The rand has been getting a lift from the likes of commodity prices which are firm today knowing well that the rand is a commodity currency.”
