USDZAR Near-term Volatility Medium-term ZAR Upside

UBS has raised its USDZAR forecasts due to near-term global energy risks and USD support. However, they maintain a medium-term constructive view on the ZAR supported by carry and high precious metal prices.

Key Takeaways

• 1.We raise our quarter-end USDZAR forecasts slightly through 2Q27 to account for rising risks to global energy prices and greater US dollar support in the near term.
• 2.The rand remains supported by appealing interest-rate carry and historically elevated precious metal prices.
• 3.Political noise in South Africa, including an impeachment committee for President Ramaphosa, remains a key downside risk for the rand.

Table of Contents

• USDZAR: Near-term volatility, medium-term ZAR upside
• Our view and risks
• Key drivers
• Factors to watch
• Appendix

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