Welcome to another issue of Weekly Rand Review.
And things are certainly heating up quickly, with Trump's mind-numbing first 100 hours in office, Ramaphosa's signing in the next pillar of communist legislation, and global markets at historic highs...
...yet somehow, the Rand managed to navigate all of this to end the week better off, although this was largely due to a weaker US dollar.
So, grab your favourite beverage, and let's give you some of the lowdown.

Key Moments (20-24 Jan 2025):

Some of the more critical factors affecting price action this week:

• SA Mixed Signals: Gold production and mining disappoint, while interest rates and retail sales trend higher
• Expropriation Bill Becomes Law: After decades in the planning, Ramaphosa signed the contentious and openly Communist Bill into law
• Trump Hits Ground Running: President Trump hit the ground running, with a slew of Executive Orders and actions to make good on his campaign promises
• Markets Continue to Recover: Stocks continued to recover on the back of improved optimism, with S&P 500 making new highs

Rand Starts Strong

The Rand opened the week at R18.69/$ on a confident note after a rebound the previous week - and while it came under pressure midway through the day to reach R18.77, it quickly turned this around as the US dollar took a knock ahead of the US inauguration.
The Rand took full advantage to push lower through the rest of the session to close around R18.50/$ - a significant drop...
...but one which we had anticipated days before - as can be seen from our Next Few Days prediction of the prior Wednesday evening.

(click to enlarge)

And just like that, the market followed through as we anticipated...
...the question, of course was, how much further would it go in this area?

Rand Drifts Stronger

Tuesday was less of a freefall, but the Rand still managed to drive the advantage home after a brief sortie above R19.00/$, with the USD/ZAR drifting lower through the day to close around R18.87 to the greenback...
..as US PPI came in at just 0.2% MoM, lower than the previous month and market expectations.

Rand Resilient Despite Bad News

Tuesday turned out to be a bit of a bunny hop day, bounced higher to hit R18.68/$ but then fell after lunch and drifted all the way back to end the day back at R18.50/$.
And this despite some shocker numbers coming out locally, with Gold production slipping by 11.5% year-on-year in November 2024, deepening from a 3.4% decrease in the previous month (the 13th consecutive month of decline)...
...while mining overall also disappointed, declining by 0.9% compared with last year.

Retail Sales Boost Rand

Wednesday saw the market bounced around in a range before finally ending the day at R18.44/$ a few cents stronger than where it had opened.
Inflation came in marginally higher at 3% in December...
...while Retail Sales surprises to the upside, increasing 7.7% year-on-year, its best performance since mid-2022.

And in other news...

Trump's First Action-Packed Week

If anyone thought Trump's second term was going to be a gradual unwinding of the last four years of disastrous administration under Biden, the first week is a sure indication that this will be no ordinary four years of US administration.
In just 100 hours, President Trump wasted no time flexing his executive muscle, rolling out a blitz of orders and actions to kickstart what he’s dubbed “America’s Golden Age.”
From ramping up domestic energy production to promising massive infrastructure upgrades, he’s certainly set an ambitious tone:
Immigration reform, mass deportations, tax breaks for middle-class families, return to merit-based and two-gender policies, incentives to buy and manufacture in the US and slashing red tape for businesses are high on the list, with a clear focus on shaking up U.S. trade (with tariffs high on the agenda)...
...and a major overhauling of a bloated and failed federal bureaucracy.
In short, a long-overdue return to common-sense policies.
Love him or hate him, Trump’s audacious and fearless approach to fulfilling on his promises (including a clear signal to the World Economic Forum globalist elites that their failed agenda is over), is already sending ripples through economies, financial markets, and world leaders alike!

Stocks Continue to Rise, with Some Record Highs...

Stock markets continued to show some optimism, with the S&P500, FTSE 100 and German DAX all making new all-time highs...
...how much longer can these markets hold out before we see a major correction?

Rand Fights Back Despite Expropriation Bill...

The Rand had another fightback day after opening at R18.44/$ and being immediately under pressure as the market was driven all the way up to R18.61 by early afternoon...
...but the Rand managed to claw back most of this lost ground in later trade to close out the day around R18.46/$...

...this being despite the announcement that Cyril had signed the decades-in-the-making Expropriation Bill into law, making it now official that the government can steal land as it pleases - pure Communism.
To repeat what we said back in October, this is just another wake-up call for those that thought the GNU was a step in the right direction, and that somehow the DA would steer the ANC away from its communistic ideals and agenda.
The honeymoon is officially over - but how long will the marriage last?

Rand Ends the Week With a Bang 💥

One would have thought that the above news would have spooked the market, causing a run for the door, but instead the opposite happened...
...which once again bears out the fact that the news is merely a trigger, not a direction-giver...
...and that you need to see what the market patterns themselves are telling you what lies ahead (as we did in the chart above) - not the news itself!
The Rand shrugged off the bad news with hardly a sweat as it blasted lower to hit R18.29/$ before losing a bit of ground to close out the week around R18.37/$...

Another notable performance from the Rand, although this was largely Dollar weakness.
Let's put this into some numbers:

Did you see these moves coming?
Did you manage to take action in time to protect yourself or take advantage?
If not, you need the right information to make better decisions...let's talk.

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The Week Ahead

Well, here we are heading into the last week of January - already!
But it's almost like we have had a year-full in just a few weeks, with no signs of any slowing down!
We are expecting some long-term fallout from Ramaphosa's ill-fated pen last week, but short-term markets will continue to be driven by the rapidly-changing dynamics of the new Trump administration and its revised policies both domestic and geopolitically...
...as Colombia found out over the weekend, this is not an administration that will be dictated to or pushed around like the last one...
...with a president at the helm that is not afraid to back up his words with action.
Apart from the above, of course, we have a few potential data release triggers, the main ones being interest rate decisions locally and abroad:

• US: Durable Goods, Interest Rate Decision
• SA: PPI, Interest Rate Decision, Trade Balance
• EU: GDP, Interest Rate Decision

In short, expect a week of fireworks in the markets...and more ruffled feathers...in the week ahead!
Make sure you aren't caught out during these volatile times!

To give you a little helping hand, feel free to take our Rand forecasting service for a test-drive!

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To your success~

James Paynter

P.S. Worrying about how to in manage your Rand exposures this year? Email me or give me a call on (041) 373-6310 or (087) 551 2848 - we would love to help.

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