Next Emerging Market Shock Comes From South Africa Which Unexpectedly Hikes By 50 bps

First it was Turkey defending itself tooth and nail against Bernanke’s tapering, now it is South Africa, just as we predicted less than an hour ago.

SOUTH AFRICA RAISES BENCHMARK RATE TO 5.50% FROM 5.00%; EXPECTATION WAS FOR UNCHANGED
SOUTH AFRICA CENTRAL BANK RAISES BENCHMARK RATE
RAND STRENGTHENS AS CENTRAL BANK UNEXPECTEDLY RAISES REPO RATE
S. AFRICA’S MARCUS SAYS MOVE NOT INTENDED TO AFFECT RAND
S. AFRICA’S MARCUS SAYS HAVE A FLEXIBLE EXCHANGE RATE

Naturally, the ZAR surges… for about 10 milliseconds, after which it promptly drops to a level weaker than pre-announcement!