USD/ZAR may challenge 20.00 in the near term – ING

ZAR is fracturing along geopolitical lines. Economists at ING expect the USD/ZAR pair to test 20.00 in the near term.

“The US ambassador to South Africa accused the country of shipping arms (or allowing the shipment of arms) to Russia last December. USD/ZAR traded to a new record high on the news. The US ambassador has since backtracked on those comments – although it is unclear whether the accusation still stands. It will probably be hard to put this particular genie back in the bottle anytime soon.”

“Even though we think a broad Dollar bear trend will carry USD/ZAR lower later this year, in the nearer term – a febrile environment suggests USD/ZAR may challenge 20.00.”

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