The Euro has advanced against the South African Rand by 0.7% today, at a tense time in South African politics.
- EUR ZAR rate up to 15.0241 – ZAR EUR rate drops to 0.0665
- Euro rises on higher manufacturing stats – Unmoving unemployment remains at historic low
- South African Rand weakened by trader fears over Zuma vote – Date set for next VONC decision
- Euro may dip on PMI figures – Rand worsening possible on PMI stats
At an exchange rate of around 15.0241, the Euro is trading at its best exchange rate since December 2016.
Euro Advances on Manufacturing Data
The Euro’s latest appreciation against the Rand comes after a spate of forecast-beating Eurozone-wide PMI stats.
As well as the overall manufacturing PMI rising, the Euro was also aided by the fact that Greece’s manufacturing sector returned to growth for the first time since August 2016.
In other news, Eurozone unemployment remained at 9.3% in May against forecasts for a dip to 9.2%. On the plus side, this has kept unemployment at its best rate since 2009.
South African Rand Slumps as Vote of No Confidence gets a Date
In a very familiar situation for South African politicians, the nation is once again heading towards a key vote of confidence in the embattled President, Jacob Zuma.
A vote of no confidence has been scheduled for August 8th, which could theoretically see President Jacob Zuma removed from power.
Crucially, however, it is still yet to be decided if the vote will be secret or not. This decision is up to National Assembly Speaker Baleka Mbete, who is a member of Zuma’s ruling ANC party.
Mbete is expected to make her decision between July 14th and the August 8th vote. News of a secret vote could send the Rand soaring, as it would open the door to the controversial Zuma being voted out of office.
EUR ZAR Forecast: Further Euro Gains Possible on PMI and Sales Stats
Incoming Eurozone data to watch out for will come on Wednesday, covering Eurozone-wide figures.
For the Eurozone services sector, a slowdown in PMI activity is forecast for both the composite and services fields. The later Eurozone-wide retail sales results are predicted to show a dip in annual sales, while monthly sales have a slight rise forecast.
The Euro could be weakened overall by these figures, if they match forecasts and show Eurozone slowdowns in three of four areas.
The only major South African news this week will be Wednesday’s Standard Bank PMI. This measure of the ZA economy was previously on the edge of showing contraction, so an index drop from 50.2 points to under 50 could trigger a ZAR slide.
Current Interbank EUR ZAR Exchange Rates
At the time of writing, the Euro to South African Rand (EUR ZAR) exchange rate was trading at 15.0241 and the South African Rand to Euro (ZAR EUR) exchange rate was trading at 0.0665.