Extremely busy week so far with some very interesting developments in both the global and local South African currency markets.
USD presently taking a hammering trading at all time lows against the EUR, 26 year lows against GBP, and formerly trading at multi-decade lows against the CAD.
The USD is taking this beating on the back of Standard’s and Poor’s warning of sub-prime mortgage ratings cuts.
So how is this affecting our good friend the ZAR this week?
Well the USD is actually strengthening against the ZAR at the moment – even on the back of all time lows against the EUR and other currencies!
So as far as the market is concerned they would rather buy USD versus the ZAR even whilst it makes all time and multi-year lows across the board.
This surely has to tell you something about the ZAR which is currently trading at 7.03 and pushing for key 7.05-7.06 resistance. We need to see a break above this level by the end of the week and at the moment it’s looking like a strong possibility.
GBPZAR has bounced strongly currently trading at 14.25 in the interbank market.
Hang in there ZAR bears as we may get a major swing here!
