GBP/ZAR Exchange Rate Rangebound as Hopes Grow for UK Economy Following Brexit Deal
The Pound to South African Rand (GBP/ZAR) exchange rate held steady today, with the pairing currently fluctuating around R19.869.
Sterling rose against the South African Rand today following the announcement that a UK regulator had approved the Oxford/AstraZeneca coronavirus vaccine.
With the vaccine capable of surviving normal refrigerated temperatures, this means that the vaccine is easier to transport and rollout across the nation.
As a result, GBP traders are more optimistic about the UK emerging from the Covid-19 crisis.
UK Health Secretary, Matt Hancock, said that the vaccine could offer a ‘route out’ of the nation’s battle with the virus.
Pascal Soriot, AstraZeneca’s chief executive, said:
‘The good news with this is we are going to be able to inject a lot of people with one dose very quickly, provide them with a reasonably good dose of protection until they get their second dose two to three months later. That will enable us to protect many more people because we can wait two to three months for the second dose.’
Meanwhile, UK markets are more confident about the British economy now that the UK and the EU have effectively secured a Brexit deal.
South African Rand (ZAR) Struggles Following New Covid-19 Variant Announcement
The South African Rand (ZAR) has struggled following the announcement of a new Covid-19 vaccine found to be at large in South Africa.
South Africa also recently hit 1 million cases of the coronavirus as the new variant tends to spread rapidly.
Infectious disease specialist, Dr Richard Lessells, commented:
‘One million cases is a serious milestone, but the true number of cases and deaths is almost certainly much higher.
‘We have seen the new variant spread rapidly,” he said, pointing out that genomic sequencing shows it has become dominant in the coastal provinces of Western Cape, Eastern Cape and KwaZulu-Natal. It is not yet certain if the variant is as dominant in the inland Gauteng province, which includes Johannesburg and is the country’s most populous province.’
In South African economic news, this week saw the release of November’s Trade Balance data, which beat forecasts and rose to 36.72 billion.
However, with the outlook for South Africa’s struggling economy being largely uncertain – owning to the new Covid-19 strain – this failed to boost the South African Rand.
GBP/ZAR Forecast: Could a Parliamentary Consensus on Brexit See Sterling Soar This Week?
Pound (GBP) traders will be eyeing this week’s Parliamentary vote on Brexit.
If the new UK-EU trade deal passes through Parliament, then we would see the GBP/ZAR exchange rate likely soar.
Additionally, once the AstraZeneca Covid-19 rollout is underway, we could see the Pound head higher against many of its peers.
Meanwhile, the South African Rand will likely remain subdued as the outlook for South Africa’s economy continues to darken.