No Festive Cheer Ahead for South Africa's Rand, Nedbank Says
- Tighter financial conditions will weigh on currency: Nedbank
- Moody’s sees global liquidity drought carrying into 2019
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An expected seasonal dollar-liquidity crunch means the outlook for South Africa’s rand is anything but merry headed toward year-end.
Funding requirements of large European and Japanese banks going into year-end, together with the Federal Reserve’s tighter monetary policy, will probably lead to greater demand for dollars and rising offshore funding costs, according to Mehul Daya and Walter de Wet, strategists at Nedbank Group Ltd. in Johannesburg. That would weigh on the rand, one of the emerging world’s most-traded currencies, they wrote in a note to clients.