Rand drops to lowest level in four weeks
The rand fell to its lowest level in nearly four weeks in
early trading on Monday morning.
The local currency dropped ahead of a policy-focused week in which the U.S. Federal Reserve and the Bank of England areb both expected to raise interest rates to tame inflation.
Efficient Group economist Dawie Roodt warns the weaker rand could spell more trouble at the petrol pump in July.
“As the Americans increase the interest rate to combat inflation, that supports the US dollar, everything else is falling measured against the US dollar.
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“The rand currently trading at 16.03, it’s not really rand weakness but a case of a stronger US dollar.”
Roodt says the move by the South African Reserve Bank to start increasing interest rates has saved the local currency from weakening even further against the greenback.
