Rand Report: The South African rand under pressure as it continues to sink like a stone

In this shortened trading week, we can expect the South African markets to be as volatile as ever. The South African rand has been battered by a wave of risk-off sentiment as global COVID-19 cases continue to rise. With most emerging market currencies under pressure, South Africa has also struggled with its manufacturing sector as demand shifts towards Asian countries. A rebound for the US dollar continues to drag down the ZAR after a seven-week streak in the red for the Greenback. Emerging markets have suffered as the US-China trade spat continues, with the two largest economies in the world set to meet later this week. The South African rand has weakened at an unbelievable rate in the last two weeks, currently sitting at USD/ZAR 17.65 from USD/ZAR 16.34 on 27 June.

Image credit: Sable International

There are a few important data reports coming out of the Rainbow Nation this week. One of the more feared data reports for South Africans is set to be released on Tuesday. The unemployment rate for the second quarter is expected to climb from 30.1% to 34.0%. June’s retail sales figures are due out on Wednesday; analysts have forecast a rise of 48%. With gold prices rising to all-time highs, the South African mining sector has received a much-needed boost. Thursday sees the release of June’s gold production; it is expected to have climbed by 15% since this time last year. The overall mining production has inched 20% higher since May.

Market event calendar

Tuesday 11 August

  • South Africa Unemployment Rate Q2: Expected at 34%
  • Russia GDP Growth Rate (YoY) Q2: Expected at -9.6%

Wednesday 12 August

  • Great Britain Balance of Trade June: Expected at £2.8B
  • Great Britain GDP Growth Rate (YoY) Q2: Expected at -23%
  • USA Inflation Rate (YoY) July: Expected at 0.7%

Thursday 13 August

  • Australia Unemployment Rate July: Expected at 7.7%
  • Germany Inflation Rate (YoY) FinalJuly: Expected at -0.1%

Friday 14 August 

  • Euro Area GDP Growth Rate (YoY) 2nd Est Q2: Expected -15%
  • USA Retail Sales (MoM) July: Expected at 2%


Presh JM Reporter

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