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The rand rallied to R15.00/$ on Tuesday on the back of stronger than expected GDP data, announced by Statistics South Africa earlier in the day.
Despite Stats SA warning that the rebound was coming off a very low base, the local currency rallied, leaping over 1% and trading somewhat stronger even before the announcement.
The local unit strengthened to R15/$ just before market close. It had started the day at R15.14 to the greenback.
Bianca Botes, Executive Director at Peregrine Treasury Solutions, said: "South Africa saw the economy growing by a significantly stronger-than-expected 66.1% (quarter-on-quarter, seasonally adjusted, annualised) in the third quarter of 2020, following the previous 51.7% drop in the second quarter.
"While this is clearly a base-effect bounce, and the strongest quarterly pace of expansion that SA has seen, it has been well received by the market which was looking to growth of 'only' 54%."
Andre Botha, senior currency dealer at TreasuryONE, noted that the rand was on the front foot like most of its emerging market peers, and that SA was still on a negative growth trajectory of 7% for the full year of 2020.
