2019 was wrapped up
with much gusto, an eventful December seeing most developed market
central banks maintaining interest rates (Federal Reserve Press Release
can be found
here), the Conservatives won the
UK election, a
phase one deal was agreed to between the US and China, the US House
of Representatives voting to
impeach President Donald Trump, and Fitch Ratings agency deciding
not to downgrade South Africa. Throughout December the rand ranged
between 13.96 and 14.86.
The NFB Asset
Management Investment Committee decided to take advantage of the rand’s
stronger position and to increase offshore exposure through December.
Three sets of trades were completed on the 18th, 20th and 27th of
December for both the NFB Ci Stable Fund and the NFB Ci Managed Fund.
The below chart reflects the NFB Asset Management Investment Committees’
recent currency trades. The last 3 yellow markers on the below graph
reflect the decisions made in December 2019.
Source: Refinitiv
Further detail about
the December trades can be seen in the below table:
Date |
Fund |
Trade Size (as a % of Assets Under Management) |
Traded from |
Traded to |
Average Rate |
|---|---|---|---|---|---|
18/12/2019 |
NFB Ci Stable Fund and the NFB Ci Managed Fund |
1% each |
ZAR Cash |
USD Cash |
14.33 |
20/12/2019 |
NFB Ci Stable Fund and the NFB Ci Managed Fund |
1% each |
ZAR Cash |
USD Cash |
14.22 |
27/12/2019 |
NFB Ci Stable Fund and the NFB Ci Managed Fund |
1% each |
ZAR Cash |
USD Cash |
14.04 |
Unfortunately, the rally in the rand appears to be short
lived, as it began to weaken as global risk events surprised
investors, the most pertinent of which was the US strike on
Baghdad and the resultant assassination of top Iranian
commander
Qasem Soleimani, redirecting global investors to safe
havens.
