The amount of money sent from the United States to South Africa and the other way around is considerable. In 2016, around U.S. $102 billion was sent from the U.S. to South Africa in the form of remittances, and around U.S. $34 million was sent in the opposite direction. Trade of goods and services between the two countries crossed the U.S. $16 billion mark in the same year.
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The United States adopted the dollar as its official currency in 1792. The U.S. dollar is also used as sole currency in El Salvador, Ecuador, the Caribbean, the Federated States of Micronesia, two British Overseas Territories, the British Virgin Islands, as well as Turks and Caicos Islands.
Some of the countries where the use of the U.S. dollar is accepted alongside other currencies include Myanmar, Cambodia, Panama, Belize, Zimbabwe, and Liberia. Some of the currencies still pegged to the U.S. dollar include the Hong Kong dollar, the United Arab Emirates dirham, the Djibouti franc, and the Bahamian dollar.
The U.S. dollar’s share of the global forex market turnover was 87.6% in April 2016. While the U.S. dollar is the world’s most commonly traded currency, it is also the most preferred global reserve currency. It is estimated that more than U.S. $5 trillion makes its way through the international foreign exchange market each day.
|Nicknames||Buck, moolah, paper, dough, dead presidents, |
bones, greenback, green
|Bank notes||$1, $2, $5, $10, $20, $50, $100|
|Coins||1c, 5c, 10c, 25c, 50c, $1|
South African Rand
The South African rand has been the official currency of South Africa since February 1961. The rand also serves as legal tender throughout the Common Monetary Area which includes South Africa, Namibia, Swaziland, and Lesotho. However, Namibia, Swaziland, and Lesotho have their own currencies too, which are pegged at par to the rand. Botswana used the rand as legal tender until 1976.
In April 2016, the South African rand was the 20th most commonly traded currency in the world, accounting for around 1% of the global forex market turnover.
|Bank notes||R 10, R 20, R 50, R 100, R 200|
|Coins||10c, 20c, 50c, R 1, R 2, R 5|
U.S. Dollar / South African Historical Rates
Upon its introduction in February 1961, the South African rand replaced the British pound at the rate of R 2 = £1. Until the early 1970s, the rand traded at around R 1.5 against the U.S. dollar. High levels of inflation, political pressure, and sanctions placed on the country because of its apartheid system resulted in the depreciation of the rand by the early 1980s.
In March 1982, the rand was almost at par with the U.S. dollar. It traded below R 1.3 against the dollar until May 1984. The rand then saw a period of rapid deprecation, peaking at a then high of R 2.7740 against the U.S. dollar in August 1985.
The rand saw a period of relatively stability from then until late 1989, trading at around R 2.5 to R 2.7 against the U.S. dollar. However, once it was evident that the country was to have a democratically elected government with a black majority, there was growing uncertainty about the country’s economic and political future. This led to further depreciation of the rand. In November 1992, the rand traded at over R 3 against the U.S. dollar.
The changing political landscape of South Africa in the early 1990s resulted in more uncertainty and caused the rand to drop to record lows. The fall was made much worse after the land reforms began taking place in 2001. The rand dropped to a then all time low of close to R 12 against the U.S. dollar.
The rand recovered significantly in the following years, until late 2004. In December 2004, the rand traded at around R 5.66 against the U.S. dollar. However, by early 2005 the rand started losing value again, and it briefly crossed the R 12 mark in early 2009. After getting to a record high of close to R 16 against the U.S. dollar in January 2016, the rand began showing signs of recovery. It traded at below R 12 against the dollar in early 2018.
USD/ZAR in the last five years
|1 July, 2013||R 9.8680|
|1 July, 2014||R 10.7065|
|1 July, 2015||R 12.6745|
|1 July, 2016||R 13.8800|
|1 July, 2017||R 13.1803|
USD/ZAR in the last five months
|U.S. $1 =|
|1 March, 2018||R 11.8385|
|1 April, 2018||R 12.4688|
|1 May, 2018||R 12.7013|
|1 June, 2018||R 13.7275|
|1 July, 2018||R 13.2750|
What Affects USD/ZAR Rates?
The value of the rand is now correlated with the price of gold in some way, because South Africa’s economy relies on export of gold to a large extent. However, the country’s unstable political climate and its fragile economy make the rand’s fate rather uncertain. Foreign investment in South Africa tends to have an effect on the value of the rand as well.
Other factors that might influence USD/ZAR currency pair include policy changes made by the U.S. Federal Reserve, global commodity prices, economic uncertainty, as well as trade deficits of both countries.
The USD/ZAR exchange rate requires your attention if you plan to send money from the U.S. to South Africa or the other way around. Bear in mind that even a small difference in exchange rates may have a noticeable effect on the total cost of your transfer, especially if you plan to transfer a large sum. As a result, take some time to compare your options well.