Since the appointment of Cyril Ramaphosa as Jacob Zuma's replacement, the relative political stability is playing a part in increasing the value of the Rand. The below table shows the difference in ZAR you could have achieved when buying £200,000.00 during the high and low points of the past 30 days.
|Currency Pair||% Change||Difference on £200,000|
The South African Rand has been strengthening recently after the change in leadership with Jacob Zuma having been replaced by new president Cyril Ramaphosa. During Zum’a leadership unemployment has been increasing whilst growth has slowed and this has caused big problems for the Rand against a whole host of currencies.
Indeed, whilst the Pound has struggled against a number of currencies during the last few months we have generally seen the Pound rise against the ZAR until recently. During the last ten years South Africa has grown at an average yearly rate of 1.4% but as an emerging economy the expectations should be closer to 5% for growth.
Cyril Ramaphosa who represents the African National Congress has pledged to stop corruption and improve the economy under his stewardship.
With unemployment at 30% and low growth this has seen credit ratings agencies downgrade the country to junk status. However, the likelihood of further downgrades in South Africa's credit rating now appears to be remote as the agencies should in theory be looking at what will happen to the economy rather than focus on what has happened previously, when President Zuma was in power.
Part of the reasoning for the downgrading was because of the political uncertainty and as that has now been settled this is another reason for the recent strength of the Rand versus the Pound.
In the last fortnight the GBPZAR exchange rate has fallen from 17 on the interbank level to over 4% lower highlighting the confidence in the country following the change of leadership. This is the difference of over ZAR 70,000 on a currency transfer of £100,000.
This goes to show the importance of keeping in close contact with your account manager who will be able to keep you updated on what is happening with exchange rates. Indeed, the GBPZAR currency pairing is the most volatile currency pair we deal with so make sure you’re prepared to move quickly when making a transfer or speak with your account manager about placing a Limit Order which allows to buy at a pre-determined rate.
For more information on how future data releases could affect your currency requirement, call our trading floor on 01494 725 353 or email me here.
As always, I got an excellent rate. Tom is always helpful and the whole process is extremely quick, efficient and simple.
Tom helped us so much explained every thing and got us a better rate to buy our home in Spain, when we had to pay for furniture went back again and he sorted a rate out for me.
Brilliant service, genuine advice and rapid transfer of money to our French bank account. Tom Holian seems like a friend although we’ve never met!