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South African Rand (ZAR) - BER Currency Guide

In this currency guide we look at :


  1. ZAR General Info
  2. ZAR Recent Performance
  3. ZAR Market View
  4. ZAR Cross Rates

South African Rand General Info

The three letter currency code for the South African Rand is ZAR and the symbol is R. It is the domestic currency in South Africa.

Trading in South Africa’s rand contributes to 1% of daily foreign exchange market volume. Like a dollar currency, the rand is subdivided into 100 cents. The word rand comes from Witwatersrand – that being the name of the ridge upon which Johannesburg is built.

The rand has traditionally been considered a ‘commodities currency’ due to South Africa being a resource-rich nation who export a great deal of gold, platinum, coal and oil, among other commodities. However, in a study by the Bank for International Settlements in 2016, researchers concluded that of eleven currencies studied, the rand could be predicted the least by changes in commodities prices.

As an emerging market currency, the rand is considered riskier than currencies from major developed nations, which means that its value will fall against those currencies (especially JPY, USD, CHF, GBP and EUR) during periods of economic uncertainty or when global geopolitical risk is elevated, or during bouts of high market volatility.

Historically, the rand’s lowest valuation against the US dollar came in January 2016 when USD/ZAR reached 16.84. Its all-time high occurred in June 1973 when USD/ZAR stood at just 0.67. More recently, since 2008, the rand was strongest in May 2011 when USD/ZAR fell to 6.54.

ZAR Foreign Transfers ZAR Travel Money Read our Travel Guide to South Africa

South African Rand - Recent Performance

In late October the rand fell to eleven-month and sixteen-month lows against the dollar and euro, with USD/ZAR and EUR/ZAR climbing to 14.35 and 16.87 respectively.

The rand was sold heavily following October’s mid-term budget, in which South African Foreign Minister Malusi Gigaba made clear South Africa’s struggles with sluggish growth, falling tax revenues, rising national debt and high unemployment.

In the aftermath of the budget, ratings agency Moody’s expressed concern over South Africa’s economic direction and markets moved to price in further sovereign ratings downgrades. Moody’s is likely to align itself with Standard & Poor’s and Fitch by dropping its rating for South Africa to “junk” when it next reviews the country on November 24th.

Forecasts for the rand were thin on the ground in October. Standard Chartered’s Warrick Butler said that USD/ZAR might move back into the high 13s before rallying again.

What is clear is that investors are expecting rand volatility to pick up ahead of December’s leadership contest of the ruling ANC party. Implied three-month volatility in rand FX options is significantly higher than it was in early September.


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