Rand at its strongest in three years

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The rand is at its strongest against the dollar in three years.

It continues to strengthen in Asian trade, and is currently trading at R11, 58 against the dollar, from R11. 62 at the close of the JSE Thursday after Cyril Ramaphosa was sworn in as the new President of South Africa.

The stronger rand should stabilise inflation and make it possible for the Reserve Bank to cut interest rates.

However, the stronger rand is mainly the result of a weakening dollar against other major currencies, for example the euro, where the dollar has weakened from $1.22 recently to $1.25 currently.

A weaker dollar usually strengthens the rand and other emerging market currencies.

The rand reached its weakest level at around R16.80 at the beginning of 2016.