Streaming issues? Report here
CapeTalk logo 2017 1500 x 1500 CapeTalk logo 2017 1500 x 1500
Best of CapeTalk
21:00 - 00:00
volume_up
volume_mute

Up Next: Weekend Early
See full line-up
Best of CapeTalk
21:00 - 00:00
Home
arrow_forward
Business
fiber_manual_record
Politics

Our volatile but resilient rand: 'Driven only one-third by domestic factors'

12 January 2021 6:48 PM
Tags:
Rand
The Money Show
Bruce Whitfield
Exchange rate
John Cairns

'Don't forget the rand tends to strengthen slowly and then weaken quickly.' Bruce Whitfield interviews RMB strategist John Cairns.

The one thing the rand is - if nothing else - is incredibly volatile!

Bruce Whitfield, The Money Show host

The currency may have started 2020 at about R14.50 to the US dollar and ended the year around R14.60, but during those 12 months it was anything but stable, remarks Bruce Whitfield.

"It traded as weak as R19.26 to the dollar on the 5th of April and then R14.60 on New Year's Day this year."

On Monday, ten days later, the rand fell to a one-month low of R15.58 to the US dollar.

John Maytham speaks to John Cairns, Global Markets Strategist at Rand Merchant Bank (RMB).

Cairns notes that South Africa has the second most volatile currency in the world.

We must never forget this ability of the rand to move very quickly, and particularly the ability of the rand to weaken very quickly. It tends to strengthen slowly and then weaken quickly.

John Cairns, Global Markets Strategist - Rand Merchant Bank

It's the Brazilians who typically outdo us. The Turkish lira's also been particularly volatile.

John Cairns, Global Markets Strategist - Rand Merchant Bank

Typically, volatile currencies are emerging markets, commodity exporters with high inflation and interest rates... In the developed world it's Australia, New Zealand and Canada.

John Cairns, Global Markets Strategist - Rand Merchant Bank

Cairns says the ongoing rally in commodity prices is helping South Africa's export sector.

However the import sector is still constrained, largely due to weak domestic demand because of the economic fallout of the lockdown.

He emphasizes the effect of movements in the global economy and looks at the chances of a global recovery in 2021.

The rand - just like it did after 2001 and 2008 - has come screaming back.

John Cairns, Global Markets Strategist - Rand Merchant Bank

I always like to say the rand is driven two-thirds by global factors and one-third driven by domestic factors.

John Cairns, Global Markets Strategist - Rand Merchant Bank

There's so much optimism out there about a vaccine-inspired economic boom in the second half of 2021; markets have been betting on that... and the rand's been caught up in that whole wave.

John Cairns, Global Markets Strategist - Rand Merchant Bank

Listen to Cairns discuss the drivers of the hoped-for 2021 recovery:


This article first appeared on 702 : Our volatile but resilient rand: 'Driven only one-third by domestic factors'


12 January 2021 6:48 PM
Tags:
Rand
The Money Show
Bruce Whitfield
Exchange rate
John Cairns

More from Business

JSE Johannesburg Stock Exchange 123rf 123rfbusiness

Economy in 2021: 'Expect a better year for South African assets'

15 January 2021 3:02 PM

An economist expects China growth at 9.5%, US money-printing, rising metal prices and trade- and current-account surpluses in SA.

Share this:
Read More arrow_forward

Funky hipster retired older mature couple 123rf 123rfbusiness retirement

Retirement funds in SA are changing – new laws come into effect on 1 March 2021

15 January 2021 1:23 PM

Bruce Whitfield asks personal finance advisor Warren Ingram to explain in detail the new laws affecting provident funds.

Share this:
Read More arrow_forward

Germany german flag covid-19 123rf pandemic 123rfworld

Germany Covid-19 death rate now higher than US - considers 'mega lockdown'

15 January 2021 11:33 AM

Germany has squandered its early success in restricting Covid-19, laments Deutsche Welle Correspondent Chelsey Dulaney.

Share this:
Read More arrow_forward

Pouring red wine from bottle into glass with wooden wine casks winemaking 123rf

Wine industry runs out of storage due to ban - R1.5b's worth could be lost

14 January 2021 9:06 PM

A new harvest is imminent and there's no more space for unsold wine. We have the highest stock level ever - Vinpro's Rico Basson

Share this:
Read More arrow_forward

scam-alertjpg

Don't fall for promises of high returns from latest investment scam, warns FSCA

14 January 2021 8:19 PM

A new scam is surfacing on Facebook and WhatsApp groups. The masterminds are even using the FSP number of a legitimate company.

Share this:
Read More arrow_forward

Restaurant with spaced table for Covid-19 social distancing

'Thank you Mr President for not shutting us down, but we need more support!'

14 January 2021 7:35 PM

Loadshedding is another blow to the struggling restaurant industry. We need more relief says Grace Harding (Restaurant Collective)

Share this:
Read More arrow_forward

pick-n-pay-storefrontjpg

Pick n Pay announces retirement of CEO credited with retailer's turnaround

14 January 2021 6:41 PM

Richard Brasher will be replaced by Netherlands-born Pieter Boone in April. A retail expert evaluates Brasher's performance.

Share this:
Read More arrow_forward

business-closed-company-support-entrepreneur-owner-economy-123rf

Negotiations underway to bring back UIF Ters payments amid impact of second wave

14 January 2021 4:56 PM

Business and labour are pressing South Africa's government to introduce a new round of UIF Ters relief to mitigate the impact of the Level 3 lockdown.

Share this:
Read More arrow_forward

Elon Musk on the cover of Newsweek 123rfbusiness 123rf 123rflifestyle

Elon Musk threatens South Africa’s SKA telescope

14 January 2021 2:42 PM

Astronomers in South Africa are extremely unhappy about Elon Musk’s plans, says Jan Vermeulen of MyBroadband.co.za.

Share this:
Read More arrow_forward

200629-taxijpg

Prioritise drivers for vaccination against Covid-19 - National Taxi Alliance

14 January 2021 1:19 PM

It's a fact - minibus taxis are essential for the functioning of the economy. Lester Kiewit interviews Alpheus Mlalazi (NTA).

Share this:
Read More arrow_forward

More from Politics

City of Cape Town by night 123rf.com

Cape Town wants SA govt to change the lockdown curfew to 11pm

16 January 2021 9:59 AM

The City of Cape Town has called on national government to push out the curfew under the current lockdown level 3 regulations.

Share this:
Read More arrow_forward

john-maytham-studio-commentpng

Govt again 'letting poor down, badly, callously, obscenely' says John Maytham

15 January 2021 4:29 PM

John Maytham vents about temporarily disabled people having to stand in long queues and getting water cannons fired at them.

Share this:
Read More arrow_forward

Police van SAPS

[VIDEOS] Police spray Sassa grant queue in Bellville with water cannons

15 January 2021 2:28 PM

Journalist Saawmiet Moos in Belville describes people queuing for Sassa social grants sprayed with police water cannons.

Share this:
Read More arrow_forward

Cyril Ramaphosa ANC

Ramaphosa: We've learned from the PPE scandal, vaccines will be better managed

15 January 2021 1:48 PM

ANC President Cyril Ramaphosa says SA's vaccine rollout will be better managed to avoid any possible exploitation by what he calls crooks.

Share this:
Read More arrow_forward

Koeberg Nuclear Power Station 123rf 123rfbusiness

'Eskom has again been grossly caught with their pants around their ankles'

15 January 2021 1:29 PM

Energy analyst Ted Blom says Eskom doesn't report the additional shedding of VLS clients totaling an over 4000-megawatt shortfall.

Share this:
Read More arrow_forward

Man travel airport check-in boarding pass passport #123rflifestyle 123rf

Can you get a new South African passport right now?

15 January 2021 12:22 PM

W Cape Home Affairs' Sam Plaatjies says no, but the department has the discretion to renew passports on a case-by-case basis.

Share this:
Read More arrow_forward

Restaurant with spaced table for Covid-19 social distancing

'Thank you Mr President for not shutting us down, but we need more support!'

14 January 2021 7:35 PM

Loadshedding is another blow to the struggling restaurant industry. We need more relief says Grace Harding (Restaurant Collective)

Share this:
Read More arrow_forward

handcuffs-law-arrest-justice-crime-perpetrator-suspect-case-police-123rf

Lockdown violations: Do not sign admission of guilt form says lawyer

14 January 2021 1:58 PM

Nearly 300,000 people have been arrested for lockdown violations in SA since March 2020. Defence lawyer William Booth advises.

Share this:
Read More arrow_forward

Police van SAPS

W Cape: 5000 lockdown violations so far in 2021

14 January 2021 1:28 PM

W Cape SAPS's Brigadier Novela Potelwa says arrests are mostly for not wearing masks in public and for breaking curfew.

Share this:
Read More arrow_forward

Anoj Singh

Singh must provide affidavit by Monday after non-appearance at Zondo Commission

13 January 2021 7:47 PM

Former Eskom CFO Anoj Singh will still have to appear after not testifying as scheduled, says EWN's Gaye Davis. But will he sing?

Share this:
Read More arrow_forward