But to explain the shifts in recent months, we need to expand the story. The first important episode is the sudden and intense bout of rand depreciation around the end of 2015 and the start of 2016.
Commodity prices and capital flows played their role: the prices of South Africa’s export commodities weakened during the second half of the year and the Federal Reserve raised its main policy rate in December 2015. Perceptions of South African risk were also important, with the rand depreciating abruptly on news that Finance Minister Nhlanhla Nene had been removed from his post.