Rand likely to strengthen further, says economist
Efficient Group economist Dr Francois Stofberg says the rand is likely to strengthen further over the next couple of months.
The rand gained a bit of strength on Wednesday afternoon – trading at R17.02 to the dollar.
This is the biggest gain since the beginning of April, where it sunk to R19.34 to the greenback.
“We do see appreciative power in the rand, we are expecting it to continue strengthening and we will most likely to see it trade at R16.50 by the end of this year,” says Stofberg.
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Stofberg adds that he believes rand will strengthen to R16 to the dollar by next year.
The rand’s strength has been attributed to investor’s confidence in developing countries.
“What we see now is a reverse back to normal,” Stofberg says.
“Where American markets and developed markets aren’t as attractive as always there’s a lot of socio and political tension inside of those economies so they have now reached the end of their expansionary cycle and their going into a contractionary cycle.”