Hilary Joffe Columnist

The rand is down more than 5% against the dollar over the past month, and on Monday fell to its weakest level since the Ramaphosa rally began with December’s ANC election, joining other emerging market currencies that have been trashed by dollar strength and rising US interest rates. Foreign investors have turned net sellers of SA’s local currency bonds, selling a net R4bn for the year to date following a sharp sell-off last week, whereas in 2017 they were net buyers (of R39bn). This is in a context in which foreign ownership of local bonds had risen to record highs, making SA particularly vulnerable to a further sell-off. None of this is a crisis. Markets are volatile and the rand has been up one day, down the next, and while bond investors have, disturbingly, been net sellers, equity market investors have been net buyers of South African stocks. However, the negatives of recent weeks have highlighted the extent to which SA’s fortunes are dependent on global investor sentiment. The...

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