Good news about the South African rand

• The cost of hedging against the South African rand has fallen to its lowest level this year, indicating a potential strengthening of the currency.
• The rand's decline was partly due to the central bank's surprise interest-rate hold and concerns over the Middle East conflict, but investors are now looking to the country's improving economy and credible fiscal backdrop.
• The rand could strengthen to 16 per dollar over the next year, a gain of about 3% from its current level, according to the median estimate of analysts in a Bloomberg survey.