CD South Africa: SA data disappoints

Currencies Direct May 27th 2015 - < 1 minute read

It was a double whammy as South African first quarter gross domestic product (1.3%) and official unemployment (25.6%) both missed the mark yesterday. Thanks to the poor local data and global risk-off sentiment, continued EUR/USD losses have translated into rand losses to the US dollar as opposed to gains against the euro. This leaves the rand vulnerable to EUR/USD moves and opens the door to further weakness. Official SA unemployment is now at a 12-year high of 25.6% (however a new sample pool was used and the drought up north didn't help), and with gross domestic product of 1.3% for the first quarter of the year, South Africa will struggle to hit 2% growth for 2015. There is little to no news on the cards today, which should let nature run its course. 

Commentary by Gareth Frye

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Currencies Direct

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