Don’t bank on the ‘Ramaphosa rally’ lasting too long, warns BMI Research
The rand’s "Ramaphosa rally" is going to falter, and the South African currency will weaken back to about R14.80 to the dollar by 2019 — which is good news for SA’s gold miners, BMI Research said in a note e-mailed on Friday morning."While Cyril Ramaphosa’s election as new ANC leader on December 18 and as president of SA on February 15 gave the rand a further appreciatory boost, we expect this trend to be reversed in the coming months as attempts to implement reforms in the country stall and inherent weaknesses in the South African economy continue to weigh on the currency, while gold prices continue to head upwards ," BMI said."We expect Ramaphosa’s market-friendly reform agenda will likely be slowed, if not impeded, by strong opposition within the ANC, which will consequently sour investor sentiment towards the rand in the next six months."Recent results from miners AngloGold Ashanti and Sibanye-Stillwater showed the benefit of a rally in the gold price had been outweighed by the ...
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