The USD has gained support in recent weeks following uncertainty surrounding President Trump’s tariff plans and a decrease in expectations for US interest rate cuts. However, more recently, market sentiment has been influenced by Trump’s speech at the World Economic Forum, where he avoided immediate tariff actions. This has led to a weaker USD amid expectations of easier US monetary policy and declining Treasury yields.
ZAR resilience is supported by SARB’s conservative monetary policy and anticipated reforms in fiscal and structural policies. Upcoming events such as the Budget and the State of the National Address are critical to its future performance.
Global risk aversion has eased slightly but remains elevated compared to earlier levels in 2024 amid ongoing shifts in global monetary policy expectations.