The rand lost more than 20c in late afternoon trade on Wednesday after the dollar gained on speculation US President Donald Trump’s expected tax breaks would be bigger than anticipated. Treasury secretary Steve Mnuchin confirmed the business tax rate would be reduced to 15% from 35%, which would be a boost for small businesses. The middle-class cuts would be more modest. The dollar rallied in response from an intraday weakest level of $1.0951 to the euro to better than $1.09, sending the rand weaker. The rand failed to trade below R13/$ for most of the morning, despite positive producer price inflation data released just before midday. The producer price index (PPI) decelerated to 5.2% in March from 5.6% in February and markedly lower than market expectations of a 5.6% rise. With two of the three main ratings agencies having already downgraded the country’s credit rating and a third having placed it on review for a likely downgrade, it is clear that the currency will play a major ro...
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