Rand pushes to two-month low amid domestic political uncertainty
Questions over the composition of the next cabinet and concern over the state of Eskom weighs on the rand, which has weakened past R14.60/$
The rand extended losses against the dollar on Tuesday afternoon, falling to a two-month low, as local political uncertainty took its toll. ANC deputy president David Mabuza was earlier sworn in as an MP, just days after President Cyril Ramaphosa announced a delay in composing his new cabinet. This uncertainty was weighing on the currency, analysts said, with the rand by far the worst-performing emerging-market asset on Tuesday. Uncertainty over the US-China trade war persists, but local developments are also weighing on sentiment. Eskom CEO Phakamani Hadebe resigned on Friday and the future of the embattled power monopoly, as well as the extent to which it will require state financial support, are still open to questions. At 2pm, the rand had lost 1.21% to R14.6023/$, 1.21% to R16.3454/€, and 1.1% to R18.4996/£. The euro was flat at $1.1194. The benchmark R186 government bond had weakened, with the yield rising 2.5 basis points to 8.42%. Bond yields move inversely to bond prices. A...
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