South African Rand Climbs on Commodities Rebound
After a bearish last week that forced emerging market currencies down versus refuge investments in the U.S. and Japan, risk appetite returned timidly today, allowing the South African rand to climb as commodities rebounded.
The South African rand topped the list of best performing currencies in the beginning of this week as risk appetite rebounded globally after concern an eventual Greek deficit default decline today after government officials affirmed that the southern European nation will manage to dodge an economic collapse with efficient measures to be taken by Greece’s policy makers to adjust the nation’s budget.
USD/ZAR traded at 7.7250 from an opening rate of 7.7438.
If you want to comment on the South African rand’s recent action or have any questions regarding this currency, please, feel free to reply below.
February 9th, 2010 at 2:43 am
In and of itself a Greek bankruptcy or bond default should -in theory- not affect the Euro as such very much, Greece being maybe 3% of the total. However, just as a Californian bankruptcy would reflect badly on the “state of the Union” as a whole so would the default of on EU country, coupled with the rising interest rates and thus further destabilisation of the remaining over-leveraged member states, make investors wonder when sovereign default across the board is likely. Thus they wouldn’t commit themseves to bonds of longer maturity and that’s the beginning of the end.
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February 9th, 2010 at 3:07 am
its important to remember thought, that not only Greece, but multiple other Eurozone countries that account for bigger parts of the EU GDP are facing a similar situation
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