Is the rand at fair value?

Econstor (Econstor) 2026 Open access

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Authors: Oliver Guest, Daan Steenkamp
Cited by: 0

Abstract

This paper assesses whether the rand has been misaligned relative to its economic fundamentals compared to the dollar. Using a Bayesian regime‐switching Vector Error Correction model that allows for the drivers of exchange rate movements to change over time, we show that the historical dynamics of the value of the rand can be explained by a small number of macroeconomic fundamentals.

Fields of Study & Subjects

Monetary Policy and Economic Impact Global Financial Crisis and Policies Financial Markets and Investment Strategies

Publication details

Journal / source
Econstor (Econstor)
Publication date
1 January 2026
Language
EN