April 21, 2021 - Written by John Cameron
STORY LINK Pound South African Rand (GBP/ZAR) Exchange Rate Falls Despite Concerns for South Africa’s Economy
GBP/ZAR Exchange Rate Sinks as Confidence in South African Economy Improves
The Pound South African Rand (GBP/ZAR) exchange rate fell by -0.3% today despite signs that South Africa’s economic recovery is beginning to slow down. The pairing is currently fluctuating around R19.86.
Michelle Dickens, chief executive officer at TPN Credit Bureau, said that commercial tenant payment has been underwhelming, and may reflect back in economic growth measured by GDP data.
‘The slowdown in the pace of recovery in tenant payment indicates that the pace of economic recovery is slowing with the partial recovery in the economy mirroring the muted recovery in tenant payment performance.’
In South African economic news, today saw the release of the latest Consumer Price Index for March, which confirmed forecasts and rose by 0.7%.
SABC News commented:
‘The main contributors to the 3.2% annual inflation rate were food and non-alcoholic beverages; housing and utilities; transport; and miscellaneous goods and services.
‘Food and non-alcoholic beverages increased by 5.7% year-on-year and contributed 1.0 percentage point to the total CPI annual rate of 3.2%.’
As a result, South African Rand investors have become cautiously more confident about the outlook for the nation’s economy.
Pound (GBP) Exchange Rate Falls Despite Rising UK Inflation
The Pound (GBP) struggled against the South African Rand (ZAR) today despite UK inflation rising by 0.7% in March.
Office for National Statistics official Jonathan Athow commented:
‘The rate of inflation increased with petrol prices rising and clothes recovering from the falls seen in February.’
UK home sales have also risen to their highest level since at least 2005, buoying confidence in the UK economy.
Nicky Stevenson, the managing director at the national estate agent group Fine & Country, commented on the new report:
‘The property market remains in a parallel universe at odds with the wider reality everyone has been living.
‘It’s been a gloom-defying 12 months, given that last March, when the first lockdown arrived, the market seized up, mortgage products were withdrawn and everyone held their breath.’
GBP/ZAR Exchange Rate Forecast: Could Improving Risk Sentiment Boost the South African Rand?
Pound (GBP) traders will be awaiting tomorrow’s release of April’s UK Consumer Confidence report.
Any signs of improving UK consumer morale would boost the Pound South African Rand (GBP/ZAR) exchange rate.
The Pound South African Rand (GBP/ZAR) exchange rate could fall over the course of this week, however, if risk sentiment improves and drives demand for risky assets like the ZAR.
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TAGS: Pound Rand Forecasts South African Rand Forecasts