The USD dollar currency fund returned -3.41% in rand terms for the first quarter of 2018 compared to the benchmark return of -3.64%.

The $5.7 billion Fund, managed by Fidelity Worldwide Investment, is a triple A rated stable net asset value liquidity fund, with a focus on security and diversification of risk, whilst delivering a return in line with money market rates. The rating is the highest possible money market rating for a money market fund by Moody’s and Standard & Poor’s.

The Rand gained significant ground during the first quarter as former president Jacob Zuma resigned and Cyril Ramaphosa was elected as the new president of South Africa. The Rand closed the quarter off at R11.84 to the US Dollar after trading at R12.38 at the end of 2017. This however resulted in the fund making negative returns in rand terms. The Rand is still volatile due to economic uncertainty and a low growth environment in South Africa. Moody’s affirmed South Africa’s investment grade rating at the end of March and changed its credit outlook to stable from negative.

The final estimate of fourth quarter US GDP came in at 2.9%, up from the previously reported 2.5%. This was largely due to higher inventory build-up than previously estimated. Core personal consumption expenditure, the US Federal Reserve’s preferred measure of inflation, rose to 1.6% in the 12 months through February, but remains below its 2.0% target. US consumer confidence declined and was below expectations in March, indicating less optimism about current business conditions and dampened prospects for the next six months. However, consumer spending rose for the second straight month in February. On the policy front, the Fed increased the interest rate range to 1.50–1.75% at its March meeting. This was the first interest rate hike under new Fed Chairman Jerome Powell. The fund continues to focus on high quality issuers, with about 54% invested in entities rated Aa3 or higher. The fund’s weighted average maturity was increased to 40 days from 21 days previously. The fund continues to invest mainly in commercial paper and certificates of deposit with investment companies and banks.

STANLIB Euro Currency Fund of Funds have closed and amalgamated into STANLIB USD Currency Fund of Funds with effect from 23 March 2018.