The rand is taking leads from  the euro which has recovered quite a bit. The market has also been a bit short and we’ve seen some export selling which have also helped to strengthen  the rand,” a currency trader said.

Although stronger the Rand will still be a highly volatile currency in the near future

• Overseas Jitters and Happenings ?
• Uncertainty ?
• Speculation ?

Today the rand lost some ground again after it gained today. Reason was that a press conference to be held by Zuma & Gordhan. The currency markets didn’t know why so the rand lost ground. I guess todays drop could have been caused by uncertainty

See more in the article below

http://www.fin24.com/Markets/Currencies/Rand-rattled-by-Zuma-Gordhan-briefing-20110325

What is your opinion of the volatile South African Rand (ZAR) and what do you thinh causes it ?

US Dollar USD = Buck / Greenback
Euro EUR = Fiber
British Pound GBP = Cable / Sterling
Canadian Dollar CAD = Loonie
Swiss Franc CHF = Swissy
Japanese Yen JPY = Yen
Australian Dollar AUD = Aussie

Some info about the South African Rand (ZAR)

The South African Rand gets its name from the Witwatersrand, (White-waters-ridge) the ridge that Johannesburg is built on.

In some parts of South Africa money is referred to as “Tom.” This is a creation of Cockney rhyming slang, where the English word “jewelry” was rhymed with “tomfoolery,” and foolery was then chopped off.

South Africa is populated by many different ethnic groups with many different languages resulting in a wealth of slang terms. Coloureds may refer to money as “Kroon” which also means “virginity.” South African Indians call 100 Rands a “Clip,” and may refer to money as “Pano.”

You have heard of or know of others ?

A free floating currency exchange rate is allowed to vary against that of other currencies and is determined by the market forces of supply and demand. Exchange rates for such currencies are likely to change almost constantly as quoted on financial markets, mainly by banks, around the world.

A pegged currency maintains a fixed currency exchange rate against other currencies. This rate is often determined by the government or central bank of that currency.

Countries that have immature, potentially unstable economies usually use the pegged system. Developing nations can use this system to prevent out-of control-inflation. The disadvantage of the system is that it can backfire if the value of the currency does not really show the true value of the currecny. A black market may spring up, where the currency will be traded at its market value, disregarding the government’s peg.

Growing demand for a currency is due to either an increased  demand for money, or an increased speculative demand for money.

The transaction demand for money is highly correlated to the country’s level of business activity, gross domestic product (GDP), and employment levels. The more people there are unemployed, the less the public as a whole will spend on goods and services. Central banks typically have little difficulty adjusting the available money supply to accommodate changes in the demand for money due to business transactions.

The speculative demand for money is much harder for a central bank to accommodate but they try to do this by adjusting interest rates. An investor may choose to buy a currency if the return (that is the interest rate) is high enough. The higher a country’s interest rates, the greater the demand for that currency. It has been argued that currency speculation can undermine real economic growth, in particular since large currency speculators may deliberately create downward pressure on a currency in order to force that central bank to sell their currency to keep it stable (once this happens, the speculator can buy the currency back from the bank at a lower price, close out their position, and thereby take a profit). Speculative demand is the main reason for some currencies fluctuating exchange rates.