RMB analysts say the Rand’s current gains are perplexing with conditions suggesting that it should be getting weaker, not stronger.
RMB’s John Cairns says in, I come in every day, look at the fundamentals and conclude the ZAR should be weaker."
Yet almost every day the rand moved stronger, he added.
The pace of the rand gains have, in fact, accelerated after the USD/Rand broke 7.50 last week, with a 10 cent move on Friday alone, "a day usually associated with profit taking".
"Such accelerated moves are often associated with the late stage of a market move but trading against this trend will be brave."
The Sunday Times allegation of corruption against President Mbeki was the latest of the negatives for the rand.
Cairns says "Now we have a sitting president under question even as the president-in-waiting, Jacob Zuma, goes to court today with the support of a mass mobilization campaign".
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