Economy / South Africa
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Macroeconomic Forecast South Africa
June 2008 | Macroeconomic ForecastsSorry, you must be a subscriber to view this article in full. If you are a subscriber please login.
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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$.