EFTA01379420.pdf

22 December 2017 EM Currency Handbook 201& Still Fuel in the Tank South Africa The rand was first introduced in 1961, coinciding with USD/ZAR & EUR/ZAR exchange rates the establishment of the Republic of South Africa. It 200 180 replaced the South African pound as the legal tender. "-- 3 160 Since 1995, after the abolition of the financial rand and 16.0 t 140 capital controls for non-residents, the rand has been 14.0 12 0 freely floating. The South African Reserve Bank (SARB) 12,0 t--- 200 has, in the past, intervened in the market to iao t to accumulate foreign exchange reserves, but these have SO 3 6.0 rarely had an immediate effect on the level of the 60 40 currency. 40 20 f 2.0 00 0.0 South Africa has followed a strategy of progressively easing exchange controls on capital transactions since 40 40 40 40 4, 4r 4° 4r 4r 4r 4r 4r 4r 4P 1994. With the abolition of the financial rand in 1995, —WD/AR all exchange controls on non-residents were eliminated. However, only fully registered dealers are allowed to Scut* Deane /1494 abonorp knot, 1 conduct foreign exchange transactions. Non-residents are free to purchase shares, bonds and other assets USD/ZAR and ZAR 3M implied yield without restriction and to repatriate dividends, interest 6.2 ISO receipts, and current and capital profits, as well as the to 143 original investment capital. There are residual controls 7.8 140 on the actions of residents, but these mostly refer to 7.6 135 the lending of rand. 1.4 130 7.2 The SARB regards its primary goal in the economic 1.0 1 3 125 system as "the achievement and maintenance of price r 120 stability". The Bank has an inflation target of between 6.6 I- 115 3% - 6%. The Bank transmits its interest-rate policy to • . 64 • • • 130 the market by providing refinancing to banks at its 4 4 :4 :4 4 4 4 , 4 4 4 :4 repurchase rate, which is determined by its Monetary o's ,4 ,4 4 le 46 41 oe Policy Committee (MPC). The MPC comprises of six •••••USO/ZAR 34.4•444044.14 On -..n•USORAR members, including the Governor. Seines 044/0.64/* In August 2010 the Bank changed its monetary policy USD/ZAR implied and historical volatility implementation framework. Two main changes were 300 -.- announced. Firstly, the Bank introduced measures 25 0 aimed at streamlining the monetary policy operations 200 by announcing the daily average of the estimated 150 weekly liquidity requirement. In addition, the Bank's refinancing operation only accepts Government and 100 SARB denominated debt as eligible collateral. 00 A The rand is a fully deliverable and convertible currency. S0 P rilr aCalitinr4111rteadall and is most often quoted and traded vs. USD. -200 2010 2011 1012 2013 2014 2015 2016 201/ 1111•0414,44 tot irro4 Ito vol ••••••-.6513rnsol secre• dam** atisk &baron inn. lP Page 82 Deutsche Bank Securities Inc. CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0076885 CONFIDENTIAL SDNY_GM_00223069 EFTA01379420