The Fed Just Raised Interest Rates: These 2 ETFs Could Be the Smartest Buys Right Now

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Rising Rates Call for Selective Plays on Quality and Financials

Fed hikes have shifted the spotlight to yields and dividend strength, shaping smarter JSE bets.

The Fed’s decision to raise rates again challenges the earlier hope of cuts this year and signals a tougher environment. South African investors should watch how this impacts the rand and our banks. A stronger dollar tends to weaken the rand, which can pressure companies reliant on imported costs, but it can also boost exporters like AngloGold Ashanti. Locally, the big four banks—Standard Bank, FirstRand, Absa, and Nedbank—stand to gain from higher rates, as their net interest margins improve. Meanwhile, companies that pay steady dividends, resembling the quality stocks in the iShares High Dividend ETF, offer a buffer in volatile times. Avoid chasing growth stocks that could suffer from rising borrowing costs and focus instead on financials and high-quality dividend payers. If the global growth outlook deteriorates further, the rand could weaken more than expected, hurting local confidence and these plays. this is just our opinion and not financial advice