USDZAR
The USDZAR currency pair is considered an exotic Forex trading instrument, so it is
rarely used by traders.
The downside of working with exotic instruments is the presence of a large spread, and if we talk about USDZAR, its value usually fluctuates between 15 and 30 pips depending on the broker at four-digit quotes.
USDZAR consists of two independent currencies, namely the US dollar and the South African rand.
Moreover, judging by the configuration, we are buying dollars for rands, and not the other way around, as is the case with the main currency pairs.
The dollar is the most liquid currency, primarily held by the United States. Currently, the dollar is the world's number one currency by turnover. Almost all countries hold their foreign exchange reserves in dollars to protect and maintain the stability of their countries.
Year after year, a number of analysts consistently claim that the US will soon experience a crisis and that the dollar will lose its position in global rankings to the more stable Swiss franc. However, the entire global economy is tied to the dollar; all interstate relations, international loans, and payments for oil, gold, and any precious mineral are traded in dollars.
Despite the fact that the dollar is currently not backed by gold reserves, it remains, contrary to all forecasts, a global currency and will continue to be so. The United States has one of the strongest economies in the world, and its decline or improvement significantly impacts the exchange rates of many countries. The United States maintains strong relations with Europe, so a weakening European economy directly impacts the strengthening of the dollar.
When it comes to factors that influence the dollar exchange rate, there are many. The main drivers of the currency are considered to be a country's fundamental indicators, such as GDP, unemployment, inflation, sector reports, and employment. It's worth noting that the United States has a significant sphere of influence in the global community, so various statements by leading US officials have a significant impact on the dollar's value.
When it comes to the dollar's price movement this year, its performance is moderated more by political factors than economic ones. While there are numerous forecasts for the dollar, it's actually an unpredictable currency, with dozens of different indicators changing your forecasts just as many times a day. However, the dollar exchange rate is strongly correlated with the price of oil, as the US is the largest consumer of oil.
The ZAR is the national currency of South Africa. South Africa is the richest country on the African continent due to its vast deposits of precious minerals. Speaking of precious minerals, I'm referring to its vast deposits of gold and diamonds, the largest in the world.
Therefore, the ZAR exchange rate is directly dependent on the demand and price of precious metals. It's worth remembering that South Africa has a strong engineering industry, whose products are sold throughout Africa and to other continents. Therefore, indicators in the engineering sector also significantly influence the exchange rate.
In conclusion, I'd like to explain why this currency pair is of primary interest to investors. If you look at the price chart, you'll clearly see that, since 2011, there has been a protracted bullish trend based on the strengthening dollar and the weakening South African economy.
Therefore, despite the high brokerage commission, it's very profitable to hold a long position for a long period, which is typical for investors. From 2011 to the present day, the price has climbed 70,000 pips, which, with a smart investment approach, could have brought you simply mind-blowing profits. You can always find the USDZAR quote and spread here: http://time-forex.com/kotirovki
