Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News

      Blue Label Telecoms to change its name as restructuring gathers pace

      11 July 2025

      Get your ID delivered like pizza – home affairs’ latest digital shake-up

      11 July 2025

      EFF vows to stop Starlink from launching in South Africa

      11 July 2025

      Apple plans product blitz to reignite growth

      11 July 2025

      Nissan doubles down on South Africa despite plant uncertainty

      11 July 2025
    • World

      Grok 4 arrives with bold claims and fresh controversy

      10 July 2025

      Bitcoin pushes higher into record territory

      10 July 2025

      Cupertino vs Brussels: Apple challenges Big Tech crackdown

      7 July 2025

      Grammarly acquires e-mail start-up Superhuman

      1 July 2025

      Apple considers ditching its own AI in Siri overhaul

      1 July 2025
    • In-depth

      Siemens is battling Big Tech for AI supremacy in factories

      24 June 2025

      The algorithm will sing now: why musicians should be worried about AI

      20 June 2025

      Meta bets $72-billion on AI – and investors love it

      17 June 2025

      MultiChoice may unbundle SuperSport from DStv

      12 June 2025

      Grok promised bias-free chat. Then came the edits

      2 June 2025
    • TCS

      TCS+ | MVNX on the opportunities in South Africa’s booming MVNO market

      11 July 2025

      TCS | Connecting Saffas – Renier Lombard on The Lekker Network

      7 July 2025

      TechCentral Nexus S0E4: Takealot’s big Post Office jobs plan

      4 July 2025

      TCS | Tech, townships and tenacity: Spar’s plan to win with Spar2U

      3 July 2025

      TCS+ | First Distribution on the latest and greatest cloud technologies

      27 June 2025
    • Opinion

      In defence of equity alternatives for BEE

      30 June 2025

      E-commerce in ICT distribution: enabler or disruptor?

      30 June 2025

      South Africa pioneered drone laws a decade ago – now it must catch up

      17 June 2025

      AI and the future of ICT distribution

      16 June 2025

      Singapore soared – why can’t we? Lessons South Africa refuses to learn

      13 June 2025
    • Company Hubs
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • AvertITD
      • Braintree
      • CallMiner
      • CambriLearn
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • Incredible Business
      • iONLINE
      • Iris Network Systems
      • LSD Open
      • NEC XON
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Tenable
      • Vertiv
      • Videri Digital
      • Wipro
      • Workday
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and Media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Fintech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Lifestyle
      • Motoring
      • Public sector
      • Retail and e-commerce
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
    • Events
    • Advertise
    TechCentralTechCentral
    Home » Current affairs » Rand turns negative as bearish signs stack up

    Rand turns negative as bearish signs stack up

    By Agency Staff21 May 2018
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    News Alerts
    WhatsApp

    Bearish signs are stacking up for South Africa’s rand. Volatility is rising and with it the cost of protecting against a weakening currency, short positioning is soaring and foreigners are fleeing South African bonds at a rate last seen 18 years ago.

    After outperforming emerging market peers for much of the year, the rand is falling into line as rising US treasury yields spark dollar strength, damping demand for riskier assets. The South African currency is down 5.6% against the dollar over the past month, and more pain is in store as the currency resumes its mantle as one of the most volatile in developing nations according to strategists at Nedbank.

    “Our view for a weaker rand is now materialising, but we must admit that we are surprised by the speed at which it is taking place,” said Mehul Daya, a Johannesburg-based strategist at Nedbank. “We expect the trend to continue as the year progresses.”

    Our view for a weaker rand is now materialising, but we must admit that we are surprised by the speed at which it is taking place

    The rand slipped 0.3% to R12.81/US$ by 12.24pm in Johannesburg, a third day of losses. Nedbank forecasts the currency at R13/$ by year-end, and warns it could come under “severe” pressure if the carry trade continues unwinding.

    Three-month implied volatility for the rand versus the dollar has climbed to the highest level since December as traders hedge for wider swings in the face of a stronger dollar. The premium of options to sell the currency over those to buy it — known as the 25 Delta risk reversal — has also jumped as bearish bets outweigh bullish ones.

    Not even the attraction of yields among the highest in emerging markets could stop bond inflows — which the country relies on to help finance a persistent current-account deficit — from turning to outflows. Offshore investors ditched a net R11.5bn of South African bonds last week, bringing outflows this year to R8.4bn. That’s the first time since 2000 that South Africa posted outflows in the corresponding period.

    Short-rand positions versus the dollar jumped last week by the most since December to a three-month high, according to data from the Commodity Futures Trading Commission.  — Reported by Colleen Goko, (c) 2018 Bloomberg LP



    Mehul Daya Nedbank
    Subscribe to TechCentral Subscribe to TechCentral
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleTalkCentral: Ep 219 – ‘George and his bitcoin machine’
    Next Article Sony to shift focus away from gadgets

    Related Posts

    Company behind South African-built geyser claims up to 84% energy savings

    15 May 2025

    Are bank cards living on borrowed time?

    17 April 2025

    Nedbank, Norfund buy R573-million stake in Pele Energy

    5 March 2025
    Company News

    $125-trillion traded: Binance redefines global finance in just eight years

    11 July 2025

    NEC XON welcomes HPE acquisition of Juniper Networks

    11 July 2025

    LTE Cat 1 vs Cat 1 bis – what’s the difference?

    11 July 2025
    Opinion

    In defence of equity alternatives for BEE

    30 June 2025

    E-commerce in ICT distribution: enabler or disruptor?

    30 June 2025

    South Africa pioneered drone laws a decade ago – now it must catch up

    17 June 2025

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    © 2009 - 2025 NewsCentral Media

    Type above and press Enter to search. Press Esc to cancel.