The moral of the story is if you are willing to take the risk, or know enough to analyse the currency pair. Another important factor is how urgently you need your USD converted to ZAR. Let’s assume you are an intermediate or professional trader, could trading on a USD denominated account be of any benefit? As per the 12-month example, you can clearly see you would have lost out should you have cashed out now.
By the end of 2002, the currency was trading under R9 to the dollar again, and by the end of 2004 was trading under R5.70 to the dollar. The currency softened somewhat in 2005, and was trading around R6.35 to the dollar at the end of the year. At the start of 2006, however, the currency resumed its rally, and as of 19 January 2006, was trading under R6 to the dollar again. However, during the second and third quarters of 2006 (i.e. April through September), the rand weakened significantly. Interestingly, the SARB remains a wholly-owned private entity with more than 800 shareholders, who are regulated by owning less than 1% of the total number of outstanding shares. This is to ensure that the interests of the economy precede those of any private individual.
- The currency broke above parity with the dollar for the first time in March 1982, and continued to trade between R1 and R1.30 to the dollar until June 1984, when depreciation of the currency gained momentum.
- If the price of gold fluctuates, so does the value of Krugerrands.
- This also includes intervention in the forex markets when necessary.
- Individual merchants may also charge supplemental fees if you ask them to convert the price of an item to your home currency at checkout.
South Africa experienced major political changes in the early 1990s. For years, South Africa was ruled by apartheid, and by the late 1980s and early 1990s, the political landscape had changed. One of the outspoken critics and leaders of the anti-apartheid struggle was Nelson Mandela—imprisoned for his views for 27 years.
Recent years have seen the Rand’s value influenced by concerns about South Africa’s political and economic stability. Its banknotes have portraits of historical figures on the obverse with views of South African landscapes or landmarks on the reverse. The Bank of England printed early banknotes on behalf of the South African Reserve Bank. ZAR has been officially used since its establishment in 1961 and is subdivided into 100 cents, replacing the complex system of pounds, shillings, and pence.
The terms of the new agreement provided Swaziland with additional flexibility in its monetary policy. Through the RMA agreement, the South African rand remained legal tender in all member nations and circulated alongside the national money of the member nations. Krugerrands are among the most frequently traded gold coins in the world market. Up until the early 1970s, the rand was worth around R1.5 per U.S. dollar (USD). However, over the ensuing decades, the rand exchange rate has depreciated or weakened, meaning it costs more rand to convert to one U.S. dollar. For example, it had cost approximately R2.55 to convert to one USD in 1990, and by 1999, the exchange rate was R6.14 to the USD.
The rand was also legal tender in Botswana until 1976, when the pula replaced the rand at par. Krugerrands are gold coins that were minted by the Republic of South Africa in 1967 to help promote South African gold to international markets and to make it possible for individuals to own gold. As the currency is currently pegged to a trade-weighted basket of currencies. The SARB has stated that its policy ensures that the rand is “broadly aligned” with a basket of currencies, but they do not target a specific level for the rand.
The rand replaced the South African pound at a rate of 2 rand to 1 pound. Since the end of apartheid in 1994, the South African Central Bank has adopted policy measures to help support the country’s transition to a free-market economy. In particular, the country’s recent credit rating upgrades and increasing investor confidence could lead to more foreign capital inflows. This would help support the currency’s value and see it appreciate against other currencies. As the official currency of South Africa, it is used to buy and sell a variety of goods and services throughout the country. Though its value has fluctuated over the years, the currency remains an important part of the South African economy.
These are questions most traders have not thought to consider! In this article, we will discuss the historical data between continuation patterns the USD vs ZAR over the past few years. This will help us get a better understanding of the potential risk involved.
How to Buy USD
Using a currency conversion calculator is often the easiest way to get an estimate when you’re converting currency. Since exchange rates fluctuate on a daily basis, using a calculator can ensure your math is correct. You will also receive a free USD to ZAR exchange rate calculator that you can make use of to decide if you should trade with Forex brokers with ZAR accounts (ZAR based account currency). The all-time low exchange rate for the rand relative to the US dollar was reached in 2016 when it hit an exchange rate of just below 18 ZAR/1 USD. In 2017, credit rating agency Moody’s rated the country of South Africa barely above junk status. The South African rand (ZAR) is the currency of South Africa and is issued by the South African Reserve Bank.
On 14 February 2011, the ZAR traded at R6.90 to the dollar, its weakest point since 2009. South African ZAR coins all bear the same obverse of the state coat of arms with a sprig of Rand behind it. You might get a shock but it is normal to see these major difference in spread. You might want to convert USD to ZAR to monitor the USD vs ZAR for other reasons, such as sending physical currency across the border. Bank Wire Transfer is becoming cheaper and an easier choice as it can be done online. This tool also has many more options and useful features to offer, such as charts and alerts.
USD – US Dollar
The U.S. dollar is the currency most used in international transactions. Several countries use the U.S. dollar as their official currency, and many others allow it to be used in a de facto capacity. The rand was introduced in 1961 and takes its name from the Witwatersrand, the ridge upon which Johannesburg is built and where most of South Africa’s gold deposits were found. The controversial land reform programme that was initiated in Zimbabwe, followed by the September 11, 2001 attacks, propelled it to its weakest historical level of R13.84 to the dollar in December 2001.
The 1978 series began with denominations of 2, 5, 10 and 20 rand, with a 50 rand introduced in 1984. This series had only one language variant for each denomination of note. Afrikaans was the first language on the 2, 10, and 50 rand, while English was the first language on the 5 and 20 rand. By the time that State President P. W. Botha made his Rubicon speech on 15 August 1985, it had weakened to R2.40 per dollar. The currency recovered somewhat between 1986 and 1988, trading near the R2 level most of the time and even breaking beneath it sporadically. The recovery was short-lived, however, and by the end of 1989, the rand was trading at more than R2.50 per dollar.
ZAR is simply an abbreviation of the Dutch Zuid-Afrikaanse Rand (ZAR), which takes its name from Witwatersrand (the location of a majority of South Africa’s gold deposits). The Xe Rate Alerts will let you know when the rate you need is triggered on your selected currency pairs. Live tracking and notifications + flexible delivery and payment options. Another factor that could positively impact the currency is South Africa’s relatively low level of government debt.
The South African Rand (ZAR) is the official currency of South Africa. It is managed and issued by the South African Reserve Bank, https://g-markets.net/ which is the country’s central bank. The other option is to do the calculation manually using a simple mathematical formula.
Take your learning and productivity to the next level with our Premium Templates. The word “rand” is derived from “Witwatersrand,” the name of the high escarpment in South Africa, where the country’s capital city, Johannesburg, is located. Access data dating back to 1990 for over 38,000 FX pairs, with charting capabilities and each exporting options. During the global coronavirus pandemic, the rand weakened to more than R17 per USD and, as of August 2021, settled to approximately R15 per USD.