Business / Economy
South African Rand's lowest point had nothing to do with Zuma?
03 Nov 2016 at 09:30hrs | Views
The rand surged to a five-week high yesterday after President Jacob Zuma dropped a bombshell and withdrew a court bid to block the state capture report and a judge ordered its publication.
This boosted speculation Zuma is a step closer to leaving office.
The rand jumped as much as 1.8 percent against the dollar, the strongest level since September 28.
Government bonds firmed alongside the currency, with the yield for the benchmark instrument due in 2026 dipping 10.5 basis points to 8.655 percent.
On the bourse, the benchmark Top-40 index fell 1.5 percent to 43 787 points while the All-Share index dropped 1.2 percent to 50 338 points.
Dawie Roodt, an economist at Efficiency Group, said: "Remember that the rand, even at better levels, remains undervalued. So even a little good news is likely to be rand positive. Also, obviously our politics play a very important role in sentiments, for example the exchange rate of the rand."
Zuma is embroiled in a feud with Finance Minister Pravin Gordhan over spending by state-owned companies and on government programmes, including a mooted R1 trillion rand nuclear energy plan.
This boosted speculation Zuma is a step closer to leaving office.
The rand jumped as much as 1.8 percent against the dollar, the strongest level since September 28.
Government bonds firmed alongside the currency, with the yield for the benchmark instrument due in 2026 dipping 10.5 basis points to 8.655 percent.
On the bourse, the benchmark Top-40 index fell 1.5 percent to 43 787 points while the All-Share index dropped 1.2 percent to 50 338 points.
Dawie Roodt, an economist at Efficiency Group, said: "Remember that the rand, even at better levels, remains undervalued. So even a little good news is likely to be rand positive. Also, obviously our politics play a very important role in sentiments, for example the exchange rate of the rand."
Zuma is embroiled in a feud with Finance Minister Pravin Gordhan over spending by state-owned companies and on government programmes, including a mooted R1 trillion rand nuclear energy plan.
Source - Thompson Reuters
