Options market sees low ZAR depreciation risk

We have previously shown how options information can be used to improve forecast accuracy when predicting the USDZAR.  The risk of ZAR depreciation implied by options prices  is relatively low at the moment. Risk reversal is measure of the risk that the ZAR could move in a particular direction. A positive risk reversal value indicates that the market has always priced a greater risk of depreciation than appreciation into currency options.