{"id":745107,"date":"2024-01-24T16:56:52","date_gmt":"2024-01-24T14:56:52","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=745107"},"modified":"2024-01-24T16:56:52","modified_gmt":"2024-01-24T14:56:52","slug":"expect-a-shift-for-the-rand-in-2024-but-with-a-catch","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/finance\/745107\/expect-a-shift-for-the-rand-in-2024-but-with-a-catch\/","title":{"rendered":"Expect a shift for the rand in 2024 – but with a catch"},"content":{"rendered":"\n

The South African rand is expected to end 2024 in a much better place compared to the dollar than where it started – but the sailing is not likely to be smooth. <\/p>\n\n\n\n

Experts at Bank of America (BofA) said that the rand will likely benefit from the market’s realisation that the dollar is overvalued. <\/p>\n\n\n\n

The expected decline in the US dollar should see improved capital flows to emerging markets – benefitting the rand, they said.<\/p>\n\n\n\n

According to the latest fund manager survey from BofA, the rand is expected to end the year at R17.73\/$. <\/p>\n\n\n\n

The rand is currently at R18.83 and hit R19.19 earlier this week. Given the volatility of the rand, the experts noted that any gains would come off a low (weak) base. <\/p>\n\n\n\n

However, this improvement comes with a catch – any shifts are likely to be ‘stop-start’ and only noticeable in the second half of the year due to anxieties over the South African national and provincial elections<\/strong>. <\/p>\n\n\n\n

Echoing these sentiments, economists at Alex Forbes said that 2024 for the rand looks set to be a “year of two halves”.<\/p>\n\n\n\n

“The first half will likely be dominated by election campaigning ahead of the May-August national elections; the second half will be dominated by global developments as risk sentiment towards emerging markets is expected to turn positive,” Alex Forbes said. <\/p>\n\n\n\n

The 2024 elections are set to be hotly contested, with the ANC widely expected to lose its majority on a national level. <\/p>\n\n\n\n

However, BofA and Alex Forbes both said that they expect the status quo to remain in terms of economic policy, as the current ruling party will enter into a coalition with a smaller party. <\/p>\n\n\n

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\"\"<\/a><\/figure><\/div>\n\n\n

Not just South Africa’s election <\/strong><\/p>\n\n\n\n

Although there is certainty over the South African national election, there are still question marks over what will happen during the US election, with pros and cons for the rand. <\/p>\n\n\n\n

Currently, the US 2024 election looks set to be a repeat of the 2020 election – Donald Trump vs Joe Biden.<\/p>\n\n\n\n

Should Trump be re-elected to office, there is a huge potential that he will reimplement tax cuts that he introduced during his first stint in the Oval Office. <\/p>\n\n\n\n

BofA said that this would boost capital flows to the US, weakening the rand. <\/p>\n\n\n\n

However, Trump has also widely called for the cutting of interest rates. With the current US Federal Reserve Chair Jerome Powell’s term ending in 2026, there is also a possibility that the expected Republican leader will appoint a new dovish and\/or non-independent chair. <\/p>\n\n\n\n

Should this happen, the dollar will weaken, with investors looking to other markets that offer higher returns, including South Africa. <\/p>\n\n\n\n

\n\n\n\n

Read: The new criminal mafias ruling South Africa<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Fund managers are expecting a better year for the rand – but there will bumps along the way. <\/p>\n","protected":false},"author":95,"featured_media":745141,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11121],"tags":[16780,5349,26],"class_list":["post-745107","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance","tag-alex-forbes","tag-bank-of-america","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/745107","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/95"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=745107"}],"version-history":[{"count":4,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/745107\/revisions"}],"predecessor-version":[{"id":745157,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/745107\/revisions\/745157"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/745141"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=745107"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=745107"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=745107"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}