- Sep 22, 2005
The rand has powered to its best levels against the US dollar in 5 months, breaking through the R14/$ level this week – more because the greenback is weak than the rand is strong. Either way, your global buying power has improved substantially and if The Economist’s Big Mac Index is any indicator, the rand could be poised for even greater gains – but only if SA’s damaging domestic political issues lose prominence.
Burgernomics, the price one pays for a Big Mac in the US vs other countries in the world, was all started as a bit of a joke. But it has taken on a life of its own as it demonstrates what you can get for the price of an American Big Mac in other parts of the world. It’s an example of purchasing power parity where one uses the US dollar as base currency and compares a commodity in the US to those around the world. The Big Mac ticks a lot of those boxes.