GBP/ZAR Exchange Rate Edges Higher on SA Economy Woes

The Pound South African Rand (GBP/ZAR) exchange rate rose by 0.2% today and is currently trading around R17.7236 on the interbank market.

The South African Rand (ZAR) fell against the Pound (GBP) today despite yesterday’s South African business confidence index figures for June, which rose from 93.0 to 93.3.

The South African Chamber of Commerce (SACCI) took a dovish tone, stating:

‘What is clear is that all South Africans are expecting decisiveness on the part of government to deal with corruption, incompetence and non-performance, and certainty in urgent implementation of policies to drive economic growth and job creation.’

ZAR traders are becoming increasingly jittery on news that skilled, high-earning groups are beginning to emigrate from South Africa.

Marisa Jacobs, Director at the immigration specialists Xpatwab, commented: 

‘Following last year’s survey, ICT specialists and engineers remain the most difficult to recruit, followed by artisans, senior financial executives, professionals in the health sector, executive managers, specialists & academics, mining executives, risk managers, and foreign language speakers.’

GBP/ZAR Exchange Rate Improves as UK House Prices Improve

The Pound (GBP), meanwhile, failed to benefit from today’s release of the annual Halifax house prices figures for June.

These improved to their best since early 2017, rising from 5.2% to 5.7%.

Russel Galley, a Managing Director at Halifax, commented:

‘With the ongoing lack of clarity around Brexit, people will be looking for more certainty in the coming months, both to encourage them to list their property and to create the confidence needed to encourage buyers.’

The ongoing Tory leadership race will remain in focus today, with tomorrow seeing the votes open up for the party’s 160,000 members to choose the next leader of the Conservatives.

Brexit fears are once again ramping up, however, as Boris Johnson – the leadership favourite – recently commented that the £39bn ‘divorce bill’ that the UK could secure in the event of a no-deal could potentially be used for his lavish spending pledges.

Mr Johnson said:

‘It may have escaped your notice, but in the event of a no-deal Brexit, we will have an additional £39bn to spend.’

GBP/ZAR Outlook: Brexit and Tory Leadership Developments in Focus

South African Rand investors will be paying close attention to US-China trade relations next week.

Any signs of a US-China trade deal could provide some uplift for the risk-averse ZAR.

Pound traders, meanwhile, will be awaiting Tuesday’s BRC annual like-for-like retail sales figures for June.

These are expected to improve from the previous -3.0% to 0.8%.

Tory leadership developments and Brexit will also remain in focus.

The GBP/ZAR exchange rate could begin to fall on Brexit jitters if the new leader shows any signs of pushing forward with a no-deal exit from the European Union.

Source: CurrencyNews