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More Hawkish Central Bank No Quick Fix for South Africa’s Rand

  • Currency’s rebound after jumbo rate hike may be temporary
  • Global environment still uncertain while local factors weigh

South Africa’s Reserve Bank has tightened policy five times in a row, with a magnitude of rate hikes not seen in two decades. That hasn’t done much to help the rand.

While Thursday’s consensus-busting 75 basis-point hike to 5.5% saw the currency post a modest gain on a risk-off day in markets, it’s still headed for one of the worst declines in July against the dollar among developing-nation peers.