Rand weakens a bit as ECB keeps rates on hold
The rand had clawed back some of the 30c it lost against the dollar during and after the medium-term budget policy statement, but then lost steam
The rand reversed earlier gains and was weaker against the dollar on Thursday afternoon, tracking a softer euro, which fell after the European Central Bank (ECB) kept its rates on hold. The rand and local bonds have weakened significantly since the medium-term budget policy statement was presented on Wednesday, although the government's plans to stimulate growth and tackle fiscal challenges have drawn praise. One of the biggest concerns for ratings agencies and markets is the fact that the budget deficit is expected to remain between 4% and 4.4% of GDP, said Peregrine Treasury Solutions' Bianca Botes. “With global interest rates on the rise, government’s growing debt burden threatens to cripple the fiscus, allowing less room for expenditure on key structural economic transformation measures,” she said. Global focus was on the ECB, which earlier announced it would keep interest rates on hold, and was pressing ahead with plans to phase out its monetary stimulus programmed this year. T...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.