CD South Africa: All eyes shift to the US Fed

The rand rout appears to be taking a breather, settling a bit ahead of tomorrow night’s US Federal Reserve interest rate announcement.

Expectations are for Fed Chair Janet Yellen to raise rates by 0.25%, with markets pricing in a probability of 76%. A Fed rate lift might just be what the rand needs to kick-start a rally. As is often the case, the devil will probably be in the detail as markets look for insight into the pace of rate rises in 2016.

If the Fed provides the clarity markets are after, we may just wake up to a more positive rand come Thursday morning (if not, you know the drill). That being said, if you’re not a fan of all the rand’s lovely surprises, remember that you’d need to make a move before close of business today (it’s a public holiday in South Africa tomorrow).

We’d like to wish everyone beginning their summer holiday today a great festive season – to everyone else, we’ll see you on Thursday.     
    
Commentary by Gareth Frye