Macroeconomic Forecast South Africa

June 2008 | Macroeconomic Forecasts

Due to increasing pressures on South Africa's current account balance (the deficit amounted to an estimated 9.0% of GDP in Q108) and ongoing volatility in international financial markets, we have revised down our 2008 year-end South African rand forecast to ZAR8.2000/US$ from our previous projection of ZAR8.0000/US$. In our view, key trendline support at around ZAR8.2400/US$ will be important to watch, and a break through this level could to set up further losses towards the ZAR8.4000/US$ area in the short term. However, a forecast further 100bps hike in the benchmark interest rate in H208 is likely to provide some support to the currency, and we therefore project a year-end level of ZAR8.2000/US$.

If you would like to subscribe to Southern Africa Monitor and gain instant access to this article, please click here to subscribe.

If you would like to take a trial to Southern Africa Monitor please click on the trial link below.