The local currency remains under pressure after the governing party says it wants to expand the mandate of the Reserve Bank
05 June 2019 - 10:13
byOdwa Mjo
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The rand was weaker on Wednesday, still reeling after disappointing quarterly GDP figures and the ruling party’s resolution to change the mandate of the Reserve Bank.
The local currency slipped as much as 2% on Tuesday after first-quarter GDP contracted 3.2% from an expansion of 1.4% in fourth quarter of 2018.
The rand was under more pressure after ANC secretary-general Ace Magashule on Tuesday said the party wanted to expand the mandate of the Reserve Bank to include job creation.
At 9.30am, the rand had weakened 0.81% to R14.781/$, 0.86% to R16.6482/€ and 0.75% to R18.766/£. The euro gained 0.1% to $1,1264.
The benchmark R186 government bond had weakened, with its yield rising six basis points to 8.49%. Bond yields move inversely to bond prices.
“Yesterday’s rhetoric from the ruling party suggests that there is a cohort that either doesn’t have the necessary grasp of the real issues at stake or is playing politics and it is this sort of policy risk that the bond market is also pricing in,” said Sasfin Wealth fixed-income trader Alvin Chawasema.
Gold gained 0.61% to $1,333.4/oz and platinum 0.84% to $827.01.
Brent crude was up 0.2% to $61.48 a barrel.
Standard Bank purchasing managers index (PMI) decreased to 49.30 points in May from 50.30 in April. The SA Chamber of Commerce and Industry business confidence figures will be released later on Wednesday.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Rand weakens further as ANC ‘plays politics’
The local currency remains under pressure after the governing party says it wants to expand the mandate of the Reserve Bank
The rand was weaker on Wednesday, still reeling after disappointing quarterly GDP figures and the ruling party’s resolution to change the mandate of the Reserve Bank.
The local currency slipped as much as 2% on Tuesday after first-quarter GDP contracted 3.2% from an expansion of 1.4% in fourth quarter of 2018.
The rand was under more pressure after ANC secretary-general Ace Magashule on Tuesday said the party wanted to expand the mandate of the Reserve Bank to include job creation.
At 9.30am, the rand had weakened 0.81% to R14.781/$, 0.86% to R16.6482/€ and 0.75% to R18.766/£. The euro gained 0.1% to $1,1264.
The benchmark R186 government bond had weakened, with its yield rising six basis points to 8.49%. Bond yields move inversely to bond prices.
“Yesterday’s rhetoric from the ruling party suggests that there is a cohort that either doesn’t have the necessary grasp of the real issues at stake or is playing politics and it is this sort of policy risk that the bond market is also pricing in,” said Sasfin Wealth fixed-income trader Alvin Chawasema.
Gold gained 0.61% to $1,333.4/oz and platinum 0.84% to $827.01.
Brent crude was up 0.2% to $61.48 a barrel.
Standard Bank purchasing managers index (PMI) decreased to 49.30 points in May from 50.30 in April. The SA Chamber of Commerce and Industry business confidence figures will be released later on Wednesday.
mjoo@businesslive.co.za
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