The South African rand swung both ways for the better part of the session, struggling for direction. The rand started the Asian session soft as the market was most likely positioning itself for the budget speech, few minutes into the budget speech we saw the rand tracking lower, breaching the R14.4000/$ mark on the downside. Although when the American session opened for business, we saw the local unit losing its momentum in the afternoon, reversing all its gains and breaching a high of R14.6500/$ on the upside as the market internalized the budget. But the rand managed to show its resilience, as always, as late trades saw the local unit push back to end the session firm at $14.4962/$.

During the budget speech, the Finance of Minister forecasted 2020/21 revenues at R1.58 trillion, which is 29.2% of GDP, and expenditure at R1.95 trillion, which is 36.5% of GDP. This brings the country’s budget deficit to R370.5 billion, making up 6.8% of GDP. Government spending is expected to increase from R1.95 trillion in 2020/21 to R2.14 trillion in 2022 /23.

On the local data front we have PPI Inflation data due for today, and internationally, we look forward to GDP and jobs data in the US, amongst others.


The USD dollar index continued to bounce off from its recent six week low, with markets still trading on the back of the Fed’s dovish position on the current and, most likely future, policy direction. As the global economy is positioning itself for an economic uptick on the back of vaccination progress, the long anticipated stimulus and the recent policy stance from the Fed are still supporting current reflation trades. The greenback back rose to 90.430 before retreating to end the day 90.176.

The euro saw some gains on the back of a weaker dollar, pairing up its previous session’s losses, also supported by improving GDP data from Germany. The single currency initially dipped to a low of $1.2108 before reversing all the day’s losses to end the session firm at $1.2165

Pound sterling is still testing its previous highs, levels which were last traded in April 2018. The cable broke-out in its early activities yesterday, making a run to a high of $1.4295 before having a major pullback, and giving back some of its gains on the day to end the session still relatively firm at $1.4141.

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