September 01, 2025
MyCURRENCY News | Week 35 2025
What we know
Last week, USD.ZAR traded largely sideways. The currency pair started the week at its lowest level of 17.40, moved to its highest level on Wednesday at 17.77, and closed the week at 17.64.
On Wednesday, John Williams, Head of the New York Fed, made dovish comments, reinforcing investors’ expectations around the likelihood of Fed rate cuts. According to the CME Group Interest Rate forecast, 87% of the market expects the first 0.25% interest rate cut in September, and nearly 85% anticipates two 0.25% cuts by the end of the year.
The second-quarter US GDP estimates, released on Thursday last week, were revised upwards from 3.0% to 3.3%. While one would usually expect markets to react to such a strong GDP figure, the revision was recognised as being largely due to a sharp decline in imports resulting from trade tariffs; growth that is both misleading and unlikely to persist, resulting in almost no impact on the Dollar.
Locally, PPI data came in slightly higher than anticipated at 1.5%, compared with 1% forecast, and the market showed little reaction. The Rand weakened against both GBP and EUR last week, indicating that any strength seen against the Dollar was primarily due to Dollar weakness rather than Rand strength. The Dollar Index closed the week at 97.8, having last reached the 100 level on the first day of August, and has been gradually tapering off since then.
What others say
Reuters – Dollar trades lower with Fed cut in view, on course for monthly drop
“The dollar weakened against the euro and Swiss franc on Friday, on course for a 2% decline in August against a basket of currencies, as traders prepared for a U.S. interest rate cut by the Federal Reserve next month.“
Business Tech – South Africa kisses over 2,400 millionaires goodbye
“The latest Africa Wealth Report for 2025 shows South Africa has lost thousands of millionaires over the last ten years.“
AInvest – South African Rand and Equities: A Strategic Play Amid Dollar Weakness and Economic Optimism
“The U.S. dollar’s historic weakness in 2025 has created a unique opportunity for investors to explore emerging markets, particularly South Africa, where the rand’s strength and equity market resilience are converging with global macroeconomic shifts.“
What we think
Last week we said, “We can likely expect a market correction after the Rand’s run on Friday, but there is potential for the currency to remain strong and for substantial time to be spent below the 17.50 level in the coming weeks.”
With recent data releases having little impact on USD.ZAR, the market pulled back to its established level of resistance around R17.76, which highlights the current trend of Rand strength holding.
In the week ahead, investors will be watching US ISM data releases covering both the manufacturing and services sectors. The week will conclude with non-farm payrolls, with the market forecasting the figure to remain flat; however, any deviation from this typically results in a spike in volatility.
Rand strength against the Dollar is likely to continue, leaving the question of when USD.ZAR will reach its new lowest level for the year.
Our range for the week: 17.40 – 17.80.
Have a great week ahead.