The rand fell in value late on Monday evening against the dollar and is yet to recover on Tuesday morning.
The dollar rose sharply based on global markets over the last two days.
The rand has also been impacted by the volatility of local gross domestic product (GDP) figures due today, and the ramifications of those numbers.
At 4pm on Monday the rand was trading at R18.80, this was about 1% weaker than its previous close, according to Reuters.
On Tuesday at 9am, the rand had fallen to R18.81 to the dollar and R23.76 to the pound.
The rand was trading at R20.37 to the euro.
Danny Greeff at ETM Analytics told Reuters that, “the rand has very much been a passenger to broader dollar moves yesterday”.
THE RAND HAS LOST ALMOST 30% OF VALUE AGAINST THE DOLLAR
This is according to Izak Odendaal, an Old Mutual Wealth Investment Strategist.
In an investment note on the future of the rand in 2024, Odendaal noted that the rand’s trajectory will depend greatly on what the dollar does.
“The rand has lost almost 30% against the dollar in the past 18 months. It typically bounces back from such a blow-out. In practice, this means the dollar must weaken, which in turn implies that the US growth outperformance should fade and that the interest rate gap between the Fed and other central banks closes,” he said.
Odendaal added that the possibility of the dollar weakening can happen but its not very likely, and therefore, while the dollar’s bull market is probably over, it is not yet time to call a bear market.
Statistics South Africa is scheduled to release South Africa’s third-quarter GDP numbers on Tuesday.
It should also be noted that on Thursday this week, the Reserve Bank will publish Q3 current account data.