The recent decrease in the rand’s value has caused serious upset in the economic world. Last week, the rand plummeted to 13,27 to the US dollar, 15,22 to the euro and a staggering 20.84 to the pound. Most of the worry has stemmed from China’s devaluation of their currency just last week. Head of South African Portfolios at Citadel, George Herman, chatted to The Money Show’s Bruce Whitfield on 702 to discuss what’s up:
Nobody is escaping this but they are exaggerating these moves because the Chinese market has been slowing down for a long time. Over the last seven years the Chinese growth has come down from 14 percent to seven percent so why is that a big deal now? – 0:28
In the long term, it’s good for our economy. It’ll help us stimulate the economy and export so it’s not necessarily a bad thing as long as it happens at a slow pace. – 1:14
George spoke about the possibility of the rand to even possibly go back to a single digit once everything calms down. Mentioning something along the same lines, Warren Ingram, Galileo Capital Financial Advisor, also had a chat to Bruce Whitfield, but three weeks ago, around the 30 July. Although unsure of a specific date, Warren assured listeners that the rand would definitely rise again, even reaching a 10, but not likely to get lower. “The rand might get stronger! I’m not mad! The cycle will turn again for sure (0:33 – 1:05)” said Warren as he introduces his theory to Bruce Whitfield. “The rand is not the only currency that has plummeted. Brazil is worse, Turkey is worse…” (1:50 – 2:59).
Our currency will turn for the same reason it fell. The rand tracks commodity prices. And this will turn. 4:08
Listen to the full interview with Warren Ingram here.
But the reality of the situation is that we know as much as you do, which is definitely less than Consequence, so chat to them if you want to find the best method to protect and grow your cash.
[source: ewn]
