FX.co ★ South African Rand Hits 2023-Highs

The South African rand has rallied to approximately 17.1 per USD, reaching its strongest position since January 2023. This development follows the presentation of the nation's mid-year budget review. Finance Minister Enoch Godongwana announced an optimistic fiscal outlook, despite anticipated slower growth for this year and the next. Enhanced revenue collections surpassing projections made in May will enable the government to achieve a broader primary budget surplus and a reduced overall deficit for the current fiscal year—a significant move towards stabilizing the nation’s debt. Moreover, the National Treasury has formally endorsed the South African Reserve Bank's (SARB) 3% inflation target, addressing the central bank’s ongoing recommendations. Minister Godongwana remarked that while the short-term effects on government finances may be varied, this policy adjustment is anticipated to lower living and borrowing costs, thereby fostering economic growth and increasing revenues in the future.