Rand plummets another 14c as market digests Malusi Gigaba’s bad news
The rand was a lot weaker on Thursday morning, signalling investors’ concern about the precarious state of SA’s finances, which were laid bare during Finance Minister Malusi Gigaba’s medium-term budget policy statement on Wednesday. The local currency bought a single dollar at close to R14.20, its weakest level in about a year — a development that potentially closes the window for the Reserve Bank to cut interest rates later in the year. It was by far the worst-performing currency against the dollar out of 19 emerging-market currencies ranked by Bloomberg. The medium-term budget also revived concern that rating agencies could downgrade the country’s debt rating as soon as November, when they are scheduled to announce their reviews. The substantially weaker rand and bonds suggested investors were pricing in the likelihood of a sovereign rating downgrade. The yield on benchmark R186 rose to its highest in a year. Gigaba said revenue in the 2017-18 financial year was projected to fall ...
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