The ZAR Exchange Rate Thread

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Ho3n3r said:
I heard 6.2% this morning. Although it feels way too low for the roughness that has been the last year.
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yah i was guessing.. i just heard 6.x% :p expectation prior was higher so this was a claw back but also inline with expectation
 
Interesting graph and commentary I saw on LinkedIn.. ImageUploadedByMyBroadband1463674632.637736.jpg

Basically if the SARB got it wrong and US hikes.. We gonna be in trouble
 
So S&P are going to announce their latest ratings for South Africa next week Friday, 3 June. What does everyone think will happen? I think there's a 65% chance of a downgrade, while there's a possibility they will hold off until the next review in December.

Should a downgrade happen, there will be a sharp sell-off, with the Rand probably heading towards R17/USD initially, but will settle down to similar levels that it is now. If a downgrade doesn't happen, the Rand could well strengthen to lower R15 or high R14/USD.

Just my thoughts on it. Anyone know the exact time the announcement will happen? Want to know if it will still be possible to purchase USD if there is a downgrade.
 
Don't think it's likely. Even if it happens who will investors follow? The agency with the lower rating or the one with the high rating?
 
Denouncer said:
So S&P are going to announce their latest ratings for South Africa next week Friday, 3 June. What does everyone think will happen?
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No downgrade. I think everyone agrees the downgrade is inevitable...but don't think anyone is ready to call a spade a space yet.

Swa said:
Don't think it's likely. Even if it happens who will investors follow? The agency with the lower rating or the one with the high rating?
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Will depend on the exact wording of their mandate. And even then they're likely to play it safe & pull out at first agency downgrade...no sane investment manager wants to deal with an accusation of having broken mandate & risked money unnecessarily. Especially since there is no incentive to stay put...at near zero growth SA isn't exactly going to be a home-run in terms of returns.
 
The one part of me actually hopes for the downgrade. This will give a HUGE blow to the ruling party and hopefully they lose some support in upcoming elections which in turn will a) force them to improve things or b) lose even more support in national elections!

or, they could just play the race card and '3rd forces' card when the downgrade comes....
 
naeem said:
The one part of me actually hopes for the downgrade. This will give a HUGE blow to the ruling party and hopefully they lose some support in upcoming elections which in turn will a) force them to improve things or b) lose even more support in national elections!

or, they could just play the race card and '3rd forces' card when the downgrade comes....
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SA politics don't work like that bru. The average ANC voter is sitting somewhere in rural KZN and has never heard of Fitch and their ratings in their life. "Free" food parcels at ANC election rallies on the other hand...
 
naeem said:
The one part of me actually hopes for the downgrade. This will give a HUGE blow to the ruling party and hopefully they lose some support in upcoming elections which in turn will a) force them to improve things or b) lose even more support in national elections!

or, they could just play the race card and '3rd forces' card when the downgrade comes....
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it takes on avg 8.5 years for most countries to come back from junk status.. thats a long time with regulation 28 on pension funds.. but on the other hand if it coms off u have massive wealth creation(and inflation) much like we did in the early 2000s.

In somewaysI agree with you .. in others ways no. It will instantly hit pensioners and anyone saving for the next decade at least. I think downgrade is pretty much inevitable but some say agencies might give reprieve till december. Personally I think this is worse as then we in for an even worse time.. I'd rather have it now before elections but it looks like it will happen after.
 
I'm sure the agencies will wait to see if the work Ghordan and co. are putting in bears fruit over the next couple of months. Things would probably improve significantly if Zuma and his goons were ejected before then.

On the other hand if Zuma and co capture the treasury we're screwed because they will appoint a Gupta approved stooge whose first order of business will be approving the nuclear, SAA lease deals which we can't afford.
 
News 24 is reporting Gordhan as saying we did enough to avert a downgrade for now. Even if the agencies told him before releasing their statements, it's a bit irresponsible of him to disclose it before they release it IMO

EDIT: a downgrade from S&P and Fitch that is...
 
sox63 said:
News 24 is reporting Gordhan as saying we did enough to avert a downgrade for now. Even if the agencies told him before releasing their statements, it's a bit irresponsible of him to disclose it before they release it IMO

EDIT: a downgrade from S&P and Fitch that is...
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He has done this before. They are often in touch with the ratings agencies who have reps in the country and who fly in from overseas to meet with finance leaders
 
biometrics said:
I see a sudden improvement the past 45 minutes, wonder if the ratings has been leaked and it's not junk. We can hope.
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US data came out which indicates that they may have to hold off doing an interest rate hike in the US. So not the credit rating. USD just being traded.
 
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