The final factor which has been mentioned in the market has been the perceived increase in strike action and threatened labour unrest. Of course, the rand sometimes is pressurised by the perception that it is a “commodity currency”, or concerns may emerge regarding the privatisation process in South Africa, or regarding the so-called NOFP, the net open foreign currency position of the Reserve Bank.
Movements in the value of the rand can also, of course, be exacerbated by pure speculative trading activity in the foreign exchange market. Undoubtedly, however, the first three factors I mentioned earlier have dominated market sentiment and commentary in recent days. I believe that the pressures on the rand are really, truly and honestly overdone.