The market’s response to former finance minister Pravin Gordhan’s removal was considerably less severe than when his predecessor, Nhlanhla Nene was sacked in December 2015, but a "second-wave" sell-off remains a danger, analysts say. That President Jacob Zuma had "tested the waters" by recalling Gordhan from an international investor roadshow last Monday, could explain the more muted reaction, Sanlam Private Wealth director of investments Alwyn van der Merwe said. Nene’s firing had surprised the markets, he said. The rand immediately weakened on Monday’s news of the recall, having hit an 18-month high earlier on Monday and ending the week 8% lower. Unlike in December 2015, the latest Cabinet reshuffle had taken place in an environment where investors were generally bullish on emerging market bonds, said Shalin Bhagwan, head of fixed income at Ashburton Investments. SA could find itself exposed if investor sentiment towards emerging markets turned negative, he said. The yield on the ...
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