Absa sees rand heading to R17/$ as post-election optimism buoys markets
Financial market analysts are rapidly updating their rand forecasts to factor in more optimistic expectations that the newly formed government of national unity will spark much-needed economic reforms in SA.
Absa said in a research note on Tuesday it now sees the rand ending 2024 at R17.50/$ before advancing to R17.25/$ by the end of the first quarter of 2025 with R17/$ within sight beyond that if GNU optimism persists and global risk appetite continues to improve. The bank’s previous year-end estimate for the rand was R18/$.
Meanwhile, Swiss banking group UBS also issued a client note on Tuesday, saying the rand would likely strengthen to R17.80/$ by end-2024 as investors welcomed news that five parties – the ANC, DA, IFP, PA and GOOD – had officially signed a statement of intent to participate in the GNU. UBS said just over a week ago, prior to the formation of the GNU, that lingering uncertainty over whom the ANC might form a coalition with pointed to a rand exchange rate of R18/$ by mid-2025.
Siyasiya Nonkonela Government Of National Unity
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