The South African rand declined for the third consecutive session today as Forex traders were worried that economic growth is slowing all around the globe, reducing demand for exports of emerging economies.
Citigroup predicted that China’s economic growth will be 7.8 percent this year, down from the previous forecast of 8.1 percent. The European Union summit may bring some relief to the market in case of a good outcome of the meeting, but for now traders are worried that it would just highlight disagreement among European leaders. Commodities were down on concerns and the rand suffered as 45 percent of South Africa’s exports consist of raw materials.
USD/ZAR climbed from 8.4010 to $ 8.5000 as of 13:47 GMT today and its daily high of 8.5190 was the highest since June 5.
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