South African Rand recovery will likely be slow
The South African Rand’s appreciation against the US Dollar has stalled due to the Iran conflict and deteriorating terms of trade.
The South African Reserve Bank’s unexpected rate hold in July has also contributed to the Rand’s weakness.
Commerzbank outlines three possible scenarios for the Rand, including the central bank being proven right and inflation not rising further, the Iran conflict ending and oil prices falling, or the conflict continuing and the central bank reversing course.