It was a strange week for the Rand...
...one where the headlines screamed "crisis" but the charts whispered "relax."
Trump revived his genocide claims at Davos — right as SA's delegation was pitching to investors. Finance Minister Godongwana admitted SA's G20 place is "up in the air." And the AGOA extension passed the House, but with SA's inclusion still uncertain.
And yet here we are — with the local unit finishing the week 23 cents stronger than it started.
What gives?
The short answer: the dollar. The greenback spent the week on the back foot as Trump backed off European tariff threats and risk appetite returned to emerging markets. Gold surged past $4,900. And the Rand rode the wave.
The result? A 1.4% gain — and a close below R16.15 for the first time since August 2022.
Let's dig into how it all played out...
Key Moments (19-23 January 2026)
These were some of the major headlines and events over the past five days:
🇺🇸 US-SA Tensions Escalate: Trump revives genocide claims at Davos, G20 exclusion confirmed, AGOA passes House (340-54) but SA's inclusion uncertain
📊 SA CPI Edges Higher: December inflation at 3.6% YoY (vs 3.5% Nov) — still comfortably within SARB's 3-6% band
⛽ Fuel Price Cuts Kick In: Petrol down 66c, diesel down R1.50 from 7 January — consumer relief
📉 Dollar Drops to 98: DXY falls to multi-month lows as Trump dials back Europe tariff threats
🥇 Precious Metals Surge: Gold touches $4,979, silver breaks $100 for the first time — strongest weekly gains since March 2020
Monday: MLK Day... But the Rand Still Moved 🇺🇸
US markets were closed for Martin Luther King Jr. Day, but that didn't stop the Rand from trading...
...and it was a volatile session.
We opened around R16.42/$ and immediately pushed stronger through the morning, touching R16.35 by midday SA time — a 7-cent gain.
But with no US liquidity to anchor things, the gains didn't stick. The local unit gave back ground through the afternoon. By the time Asia picked up the baton, we were pushing back toward R16.45...
...and we touched R16.48 in late trade — the week's eventual high.
A 13-cent range on a US holiday. Not exactly the quiet session you'd expect.
Tuesday: Shaking Off the Naval Fallout 📉
Tuesday opened at R16.36/$ and saw early caution as markets digested the ongoing US-SA tensions...
...the fallout from last week's naval exercises and political rhetoric was still weighing on sentiment.
But the Rand found support mid-morning. The dollar was softening globally (DXY dipped below 99), and that broader risk-on tone trumped the political noise.
We tested down toward R16.28 before settling back around R16.31 by the close — about 5 cents of Rand strength to start the shortened week (Monday was MLK Day in the US).
Wednesday: CPI and Davos Collide 📊
Wednesday opened at R16.31/$ with all eyes on Stats SA's December CPI release...
...and on SA's delegation making their pitch at the Davos circus...
...and of course, President Trump's much-anticipated address to the World Economic Forum (WEF) as he comes to Davos hot on the heels of increasing tensions between the US and Europe over Greenland.
The CPI landed mid-morning: 3.6% YoY, up slightly from 3.5% in November. No surprises there (comfortably within the SARB's 3-6% target band), and still well below the highs of 2022-2023...
...so the market reaction was muted.
The Rand held around R16.28-R16.32 through the SA session.
But in Switzerland, things were heating up as Trump addressed reporters at Davos and — rather inconveniently for Team SA's investment pitch — revived his genocide claims regarding South Africa. And took many shots at the globalists in his address (more on this below).
The market's reaction? Muted. The Rand largely ignored the drama. By close, we'd pushed down to R16.22/$ — another 9 cents of strength on the day.
And in other news...
The Dollar's Wobble 💵
The real story this week wasn't SA's political drama...
...it was the greenback's continued slide.
The DXY dropped to around 98 — down 8% from its 2025 highs above 110. Trump's tariff threats have kept markets on edge for months, but this week brought relief: the European tariff deadline got pushed out, and a "framework deal" on Greenland meant one less flashpoint to worry about.
For EM currencies, this is everything. When the dollar weakens, capital flows back into higher-yielding markets. The Rand, with its relatively high real rates and improving structural story, is a natural beneficiary.
Trump Takes on Davos 🎤
Trump delivered a 70-minute address to the World Economic Forum crowd...
...and didn't hold back.
He called the Green New Deal "perhaps the greatest hoax in history" — the "Green New Scam" as he put it — and took aim at Europe's energy policies. On windmills: "There are windmills all over Europe... and they are losers. The more windmills a country has, the more money that country loses...Germany produced 20% less energy now..."
His take on China? "They make almost all of the windmills, but I haven't found any wind farms in China. They're very smart — they sell them for a fortune. China goes with coal. They go with oil and gas. They're doing just fine."
He told the audience that his administration has been doing what the UN should have been doing - stopping wars.
And he laid out his case for Greenland acquisition ('the US defended it in WWII after Denmark fell in days'), how it was needed for national and world security to prevent Russia and China from gaining a foothold there.
He pushed back on European tariff threats, and generally confronted the globalist audience on their own turf and spelled out to them how their policies had failed miserably.
Markets were encouraged by his softened stance on European tariffs. But the dollar weakened further, which helped the Rand.
Precious Metals Go Vertical 🥇
Gold touched $4,979 this week...
...up 80% year-on-year and on track for its best weekly gain since March 2020.
But the bigger story might be silver. The white metal surged on Friday, breaking through the psychologically significant $100 level for the first time...
...up almost 40% in the first 23 days of 2026.
What's driving it? Dollar weakness, safe-haven flows, a historic short squeeze, and — crucially — China's new export controls. As of January, Chinese companies now need government licenses to export silver, with only 44 firms authorised. That's tightened global supply at exactly the wrong moment.
For SA, this is quietly supportive — precious metals mining remains a significant export earner, and higher gold and silver prices improve SA's trade account.
The US-SA Relationship: Where Things Stand 🌍
Let's not sugarcoat it: SA-US relations remain very strained.
This week added Trump's genocide claims at Davos and the G20 exclusion confirmation to the growing list of tensions. AGOA's future remains uncertain — the House passed a 3-year extension, but SA's eligibility isn't guaranteed.
On Trump's genocide claims — while there has been a denial of these from the government spokespersons (and the legacy media, of course), it's worth putting these in perspective.
Last week we covered the resignation of Rev Prof Musa Xulu from the CRL Rights Commission, citing a "predetermined agenda of state control of religion." The Commission's push to regulate churches echoes what's happening right now in Rwanda — where the government closed over 8,000 churches in 2024, citing building codes and "safety" concerns.
Rwanda's 2025 regulations go further: banning open-air evangelism, requiring 1,200 hours of theological training per pastor, 1,000 local signatures to register a church, and — most concerning — only permitting "teachings that align with Rwandan values" as determined by the state. The World Evangelical Alliance has said these regulations "do not meet international human rights standards."
This matters because state control of religion in Rwanda has a dark history. In the lead-up to the 1994 genocide, the "Church" and State were fused — the Catholic archbishop sat on the ruling party's Central Committee. Churches became sites of mass slaughter, not sanctuary.
As for Trump's specific framing on the genocide being race-based, the lid being blown on the CRL Commission's real agenda ('state control of religion') shows that this is not just about race, but is far more insidious — and the Rwanda parallel is not lost on those watching.
The market's reaction has been surprisingly muted. Why? Probably because SA's trade with the US is important but not dominant (roughly 6% of exports)...
...and because the structural reform story (Eskom, FATF, credit upgrade) is overpowering the political noise.
Dollar weakness is providing cover, too.
But this bears watching. If AGOA exclusion becomes reality, or if tariffs escalate, the calculus changes.
SA's Davos Message: We're Open for Business 🇿🇦
Despite the Trump distraction, Team SA tried to deliver a clear message at Davos...
...we've turned a corner.
288 days without load-shedding. First credit upgrade in 20 years. Off the FATF grey list. EU high-risk delisting effective 29 January...
...and private train operators coming online, fuel prices falling, inflation at 20-year lows.
The investment case is the strongest it's been in a decade. But against that, you have the clear government objective of going down a socialist road towards its communist end goal - and befriending nations with these same ideals. Investors see through the smoke and mirrors.
To get back to the Rand...
Thursday: Dollar in Retreat ⚡
Thursday opened at R16.22/$ and the Rand kept pressing...
...as the dollar's retreat accelerated.
The big catalyst was Trump's surprise announcement: he wouldn't impose the threatened 10% tariffs on European nations after reaching a "framework deal" with NATO on Greenland and Arctic security — the 'Dealmaker in Chief' seemed to have done it again.
Risk markets exhaled. The DXY dropped to 98.3 — its lowest level in months.
For the Rand, this was pure tailwind. We pushed through R16.15 support and tested down to R16.10 in late trade...
...levels we haven't seen since August 2022.
Gold surged past $4,900, reinforcing the "dollar out, risk on" theme.
We closed around R16.12/$ — roughly 10 cents stronger on the day.
Friday: Touching the Low, Closing Strong 🎯
Friday opened at R16.12/$ and delivered the week's most extreme moment...
...an early push to R16.08 that represented the week's (and multi-year) low.
But we couldn't hold it. Some profit-taking crept in, and the Rand drifted back toward R16.14-R16.15 through the afternoon session...
...with no major data releases to catalyse further moves.
US flash PMIs were mixed (manufacturing weakening slightly, services steady) but nothing to shift the narrative.
We closed the week at R16.14/$ — 22.8 cents stronger than Tuesday's open, and a full 1.4% appreciation for the week.
Not bad for a week where Trump's renewed criticism and SA's G20 status was confirmed as "up in the air."
Volatility and Risk Analysis
The week delivered meaningful Rand strength amid moderate volatility:
- Open to Close Move: The week opened at R16.36/$ Tuesday morning and closed Friday afternoon at R16.14/$ — a 22.8c (1.40%) strengthening.
- Average Daily Range: ~9c (0.56%)
Risk per $1 Million Exposure: R90,000 - Maximum Single-Day Move: ~10c (0.62%) on Thursday
Risk per $1 Million Exposure: R100,000 - Weekly Range: 40c (R16.08 low to R16.48 high) — 2.5% swing
Risk per $1 Million Exposure: R400,000
For Exporters: Another frustrating week — R16.36 at the open looks much better than R16.14 at the close...
...and anyone who hedged early did well.
For Importers: A gift. If you were waiting to lock in rates, Friday's close below R16.15 was the best opportunity since mid-2022...
...but the question now: does it go further?
The Week Ahead (26-30 January 2026)
SA: SARB MPC announcement (27 Jan — expected hold at 6.75%), Q4 unemployment data
US: FOMC decision (28-29 Jan — expected hold at 3.5-3.75%), Q4 GDP (advance), Durable Goods
EU: ECB meeting (Feb 4-5 — preview week), Eurozone Q4 GDP
What to Watch
SARB on Wednesday: The MPC is widely expected to pause after six consecutive cuts. With CPI at 3.6% and the Fed on hold, there's no urgency to move. Guidance on March will be key — markets expect another 25bps cut then.
FOMC on Wednesday: Powell & co. will almost certainly hold rates steady, citing inflation uncertainty and data disruptions from the government shutdown. The tone will matter more than the decision — any hints of hawkishness could support the dollar.
Dollar Direction: This week's Rand move was primarily dollar-driven. If the DXY stabilises or bounces, some of the Rand's gains could reverse. Watch the 97-98 level on DXY as potential support.
As for the Rand, we're watching some key levels on both sides for confirmation of market direction.
To your success~
James Paynter
P.S. Remember — cycles reward those who move with them...do you know what your specific exposure cycles are?
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...it moves in cycles regardless.
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Flying Blind Is Costly
This week proved once again that markets move in cycles, not linear economist logic.
While mainstream analysts were celebrating Tuesday's Dow record, our forecast system was already signaling the Rand would push through R17 before reversing...
...and it delivered, hitting R16.95 - dead centre of our predicted 17.08-16.89 range...
...before losing 25 cents in a classic reversal.
That's not luck.
That's systematic forecasting based on a combination of sentiment cycles, Elliott Wave, momentum, wave ratios & relationship studies, momentum and supply & demand...
...the same system that's kept us and our clients ahead of the curve for years.
Want to see where the Rand is headed next?
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To your success~
James Paynter
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