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Citadel: Rand remains vulnerable

Johannesburg - Although the rand is roughly in line with current underlying fundamentals, the local currency remains vulnerable in the event of a deterioration in risk appetite for emerging market assets, said Yolanda Naudé, head of fund fesearch at Citadel Asset Management.

She told delegates at Citadel’s Create Your Own Destiny women’s event that given the uncomfortable current account deficit, it is difficult to see the currency appreciating significantly from current levels.

"Less foreign capital inflows coupled with the size of the current account deficit will keep the currency under pressure. Despite solid capital flows into South Africa over the past two years the currency continued to depreciate, a significant change in capital inflows is likely to weigh on the currency even further.

"Hence, most fundamentals suggest that the currency is likely to trade in a range of R9.50/$ – R11/$ over the medium term with a potential risk for further depreciation."

Addressing an all female audience Naude said that, according to the Boston Consulting Group, women control about 30% of global wealth.

“The proportion of women economically active in the total world population has not only increased, but women are also earning more today, which is driving female wealth globally.

"Women have also become more and more financially literate and confident, thanks to education, working, earning and managing their income.

"With growing confidence, women are playing an increasingly vital role in managing a family’s wealth and financial investments."

Naude advised investors that equities is still the place to be.

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