The rand was relatively calm in midmorning trade on Monday‚ strengthening slightly against the dollar‚ off a very low base.
“The rand is the most sensitive [emerging-market] currency in the world. [It is] used as a proxy in risk-on/off trade‚” tweeted Devin Shutte‚ head of investments at The Robert Group. “As a result‚ it trades a massive 18% of SA GDP in daily forex turnover (while SA trade is less than 1% of global trade volume). Explains why external factors often outweigh fundamentals.”
The US has threatened to impose another $200-billion worth of tariffs on Chinese goods‚ upping the ante in a trade dispute between the two largest economies. Previously‚ both countries imposed $50-billion worth of tariffs on each other’s goods.