South African Reserve Bank decreased its foreign currency purchases volume almost by a half after the national currency felt significantly against the U.S. dollar in November. Depreciated rand kept country’s central bank from increasing their Forex reserves at the previous pace.
On November 27 USD/ZAR crawled up to the highest value since September 21, showing that recent South African Reserve Bank measures to hold the rand’s fast appreciation against dollar is showing some success. On November 7 ZAR was at its 18-month highest rate against dollar after more than a year of strengthening versus U.S. currency. Overvalued rand has been hurting South African commodity exporters and national central bank has been trying to fight its growth with aggersive foreign currency purchases for the last year.
After USD/ZAR showed a correction during November, South African Reserve Bank lowered its total amount of Forex purchases (that are almost fully composed of U.S. dollars) from $1.06 billion in October to $0.55 billion in November.
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