February 17, 2025
MyCURRENCY News | Week 7 2025
What we know
It has been a breath of fresh air to stray from standard economic indicators to take a closer look at the state of current affairs, specifically US-SA relations. The market opened at a rate of R18.63 to the Dollar and the Rand traded stronger throughout the week, closing at R18.30, and faring well against external geopolitical pressures.
While Trump’s tariffs have long-term global implications, the Rand was primarily affected last week by the US cutting aid to South Africa, along with the surrounding narratives.
On the US side, Trump and Musk took to X, sharing outdated videos referencing South Africa’s recently passed land expropriation bill – an extremely complex and challenging policy to implement – to support their stance.
On the SA side, it’s been crickets… and we can hope that a productive route forward is going to be the result of this. While we are used to the impulsive SA political actors retaliating almost immediately in the past, this silence may signify a change in our government’s approach to our most vital global relations, potentially one of unity.
In terms of calendar news, US inflation figures exceeded forecasts, reinforcing the Federal Reserve’s position on maintaining a less restrictive interest rate policy.
What others say
Reuters – Oil prices steady as market eyes Russia-Ukraine peace deal
“Oil prices were little changed on Monday as investors eyed developments on a potential Russia-Ukraine peace deal that could ease sanctions disrupting global supply flows.”
Daily Maverick – Clouds of uncertainty make the path ahead tricky for Godongwana and his Treasury team
“The central bank’s forecast modelling is highly dependent on predictability – and there’s none of that for the finance minister.”
Reuters – UK PM Starmer offers to send peacekeeping troops to Ukraine
“Starmer’s comments were the first time he has explicitly said he is considering deploying British peacekeepers to Ukraine.”
What we think
Last week we said…“And true to his word, Trump signed this order over the weekend. The spillover effects this will have place a major dampener on South Africa’s global trade relations and funding relied on by many companies in South Africa.”
Coming from a relatively quiet US presidential term under Joe Biden, Trump has approached his term head-on, throwing things at the wall to see what sticks. Due to an overload of new information, it has become difficult to determine the long-term implications of his strategy.
We look forward to hearing a response from the SA government regarding the reduction of aid to South Africa, and a potential strategy going forward.
The economic calendar for the week is relatively quiet. However, with Trump addressing the nation on Tuesday and Jerome Powell speaking on Thursday, the market will likely take its cues from these key events.
Our range for the week: R18.15 – R18.55.
Have a great week ahead.