The numbers reveal a stark truth about the rand’s recent performance. While it has gained 8.3% against the dollar year-to-date, the US dollar itself has weakened by 9.7%. This means the rand has actually lost purchasing power in real terms.
The currency’s underlying weakness is further illustrated by its performance elsewhere. It has weakened by 3.6% against the euro and seen a negligible 0.4% gain against the British pound.
This dynamic is driven by external factors: concerns over US growth, the Trump administration’s dollar policy, and anticipated Fed rate cuts. Despite high-profile diplomatic engagements by President Ramaphosa, including a push to extend AGOA, these external currency movements remain the dominant force, overshadowing local efforts and recent trade setbacks like the new 30% US tariffs.
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