Convert GBP to ZAR
GBP/ZAR soared to a high of 23.179 on 6 May 2020. This was the strongest this currency pair has traded so far this year.
This currency pair is more volatile than most of the leading forex pairs, owing to the volatility in the value of the South African Rand. As a commodity currency, its price fluctuates on the basis of gold prices as gold is a key export from South Africa and a major contributor to its economy. In addition, the ZAR also sees increased volatility due to political unrest in the country as well as overall global uncertainty, as South Africa is an emerging economy heavily reliant on international trade.
Domestic monetary policy has a significant impact on the value of a currency. For instance, tighter monetary policy or higher interest rates signal increased confidence in the economy, which in turn serve to strengthen the currency. In the case of GBP/ZAR, for instance, when the BOE hikes interest rates or announces a more hawkish stance in its monetary policy, the GBP strengthens and turns this currency pair bullish, and vice versa.