Sunday , July 21 2019
Home / africa / Rand among the most widely tradable currencies

Rand among the most widely tradable currencies



Rand's wild changes whenever there are good or bad news elsewhere in developing countries is the result of his status as an emerging market proxy, not domestic factors, said Francois Groepe, deputy governor at the South African Reserve Bank.

South African currency is about the 16th most widely traded currency on a global scale, and the economy is at 32rd or 33rd place, Groepe said yesterday at a lunch in Johannesburg.

Traffic in the spot is roughly $ 4 billion a day, and total turnover is as high as $ 17 billion, he said.

"There is no doubt that rand is a proxy, because why would you have such a difference in currency turnover compared to the size of the economy," he said.

Often currency is moving along with what is happening with other EMs.

The volatility of the rand, partly due to the liquidity of the relatively deep financial markets of South Africa, makes planning for the future difficult for companies that pay their costs or earn their foreign currency earnings. She also thinks about creating policies because it is a significant inflationary risk, according to the central bank.

Nineteen-year-old volatility in relation to the dollar has risen to 26 percent during the Turkish currency crisis in September, and the third is for that country alone in Libya and Argentinean weight, according to data collected by Bloomberg. Price movement has since fallen to 15.8 percent, though it is the third largest among peers in emerging markets.

South African currency is heading for its best results in November in 30 years, after winning 8.2 percent against the dollar. Nevertheless, this year, by 9.4%.


Read: Here's what will happen with rand 2019, according to the Reserve Bank


Source link