The rand was softer against major global currencies shortly before midday on Thursday, despite most emerging-market currencies firming to dollar. Risk factors continue to weigh on the rand, including the expected return of Zimbabwean vice-president Emmerson Mnangagwa to the country on Thursday, and the Reserve Bank monetary policy committee decision later in the day. Analysts expect the Reserve Bank to keep the repo rate on hold, but expect a hawkish tone, due largely to risks to the rand. The key event this week will be ratings determinations by S&P and Moody’s on Friday. A sub-investment grade confirmation by the latter would result in SA falling off global bond indices, with estimates that automatic selling of local bonds would be between R83bn and R150bn. The rand should struggle to find any strength ahead of this, and if SA was given a reprieve, rand gains may be limited and short-lived, said Standard Bank currency trader Warrick Butler. The rand’s softer tone on Thursday was d...
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