{"id":869536,"date":"2026-08-07T16:36:38","date_gmt":"2026-08-07T14:36:38","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=869536"},"modified":"2026-08-07T16:36:40","modified_gmt":"2026-08-07T14:36:40","slug":"united-states-shock-gives-huge-boost-to-the-rand","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/finance\/869536\/united-states-shock-gives-huge-boost-to-the-rand\/","title":{"rendered":"United States shock gives huge boost to the rand"},"content":{"rendered":"\n

The rand strengthened late on Friday (7 August) following shock jobs data from the United States, which softened the dollar and boosted gold.<\/p>\n\n\n\n

The rand hit R16.15 to the dollar after the jobs report, pushing towards the R16\/$ resistance level it last crossed before the US-Iran war broke out at the end of February.<\/p>\n\n\n\n

The US Bureau of Labour Statistics reported the United States economy had shed 23,000 jobs in July, a shock reversal from the roughly 80,000 to 95,000 gain economists had forecast.<\/p>\n\n\n\n

The US unemployment rate ticked down to 4.1% from 4.2%, but that improvement was overshadowed by steep downward revisions.<\/p>\n\n\n\n

June’s already modest gain was cut to 20,000 from 57,000, while May\u2019s total was slashed nearly in half to 66,000 from 129,000.<\/p>\n\n\n\n

Weak US jobs data usually boosts emerging market currencies as it weakens the dollar. It also tends to push the US Federal Reserve towards looser monetary policy.<\/p>\n\n\n\n

The US Fed held interest rates earlier this week\u2014also boosting the rand\u2014with analysts now saying that previously expected rate hikes are unlikely.<\/p>\n\n\n\n

According to Nigel Green of the DeVere Group, the jobs data makes a rate hike for the United States difficult to justify.<\/p>\n\n\n\n

“Three consecutive months of softening data is not noise. It\u2019s a labour market losing momentum in a way policymakers cannot responsibly ignore,” he said.<\/p>\n\n\n\n

The DeVere CEO noted that markets are already repricing accordingly, which was also evident in the rising gold price.<\/p>\n\n\n\n

Gold rose over 2.5% on Friday to $4,346 an ounce. The price had been rallying ahead of the release of the jobs data, an indication that safe-haven sentiment was shifting.<\/p>\n\n\n\n

“Gold was rallying into this release, and reports of weak hiring will likely extend that move further,” Green said.<\/p>\n\n\n\n

“When a currency loses support at the same time a safe-haven asset gains it, that combination tells you plainly which way sentiment has shifted.”<\/p>\n\n\n\n

Green said that the dollar was the clearest early casualty of the surprise jobs numbers.<\/p>\n\n\n\n

“Fewer jobs and slower wage growth reduce the case for tighter policy, and the dollar tends to weaken quickly once markets stop pricing in a hike,” he said.<\/p>\n\n\n\n

“Investors who spent recent weeks preparing portfolios for a September increase now need to unwind that positioning fast.”<\/p>\n\n\n\n

South African jobs numbers to follow<\/h2>\n\n\n\n
\"\"<\/a><\/figure>\n\n\n\n

Stats SA will publish its own jobs data next week, with the Quarterly Labour Force Survey for the second quarter of the year due on Tuesday, 11 August.<\/p>\n\n\n\n

According to economists at Nedbank, the QLFS is likely to show a modest deterioration in the unemployment rate in Q2. <\/p>\n\n\n\n

The unemployment rate in South Africa increased by 1.3 percentage points to\u00a032.7%<\/strong>\u00a0in the first quarter of 2026, as 301,000 people lost their jobs.<\/p>\n\n\n\n

The official jobless rate has been above 30% for more than five years and is among the highest in the world.<\/p>\n\n\n\n

“Surging fuel costs and heightened uncertainty\u2014stemming from the effects of the escalation in the US-Iran war and the subsequent blockage of the Strait of Hormuz likely weighed on business confidence,” the bank said.<\/p>\n\n\n\n

This environment appears to have encouraged firms to adopt a cautious, wait-and-see stance, delaying significant capital expenditure decisions, including hiring. <\/p>\n\n\n\n

At the same time, the labour force continues to expand due to a low labour absorption rate, the influx of new entrants into the labour market, and previously discouraged workers re-entering the job market, Nedbank said.<\/p>\n","protected":false},"excerpt":{"rendered":"

The rand strengthened late on Friday following shock jobs data from the United States, which softened the dollar and boosted gold.<\/p>\n","protected":false},"author":10,"featured_media":851084,"comment_status":"open","ping_status":"closed","sticky":true,"template":"","format":"standard","meta":{"_sma_x_autopost_status":"failed","_sma_x_autopost_error":"Instagram publishing failed: Instagram returned HTTP 400: Media ID is not available","_sma_x_post_id":"2085736985335877964","_sma_facebook_post_id":"191437357620492_2169517163868683","_sma_instagram_post_id":"","_sma_x_attempts":1,"footnotes":""},"categories":[11121],"tags":[12945,4068,22913,3670],"class_list":["post-869536","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance","tag-devere-group","tag-dollar","tag-nigel-green","tag-rand"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/869536","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\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=869536"}],"version-history":[{"count":1,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/869536\/revisions"}],"predecessor-version":[{"id":869543,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/869536\/revisions\/869543"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/851084"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=869536"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=869536"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=869536"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}