The politics of the Rand

NIGHT TALK

The Rand has been reported to be struggling and some report that it’s due to the cabinet delays. Or, anxiety over what the cabinet might look like…especially if the Democratic Alliance doesn’t join the GNU.

Guest: Dr Phali Lehohla, Economist and former Statistician General

Rand plunges after DA threatens to walk away from GNU

The rand tumbled to an almost two-week low on Thursday after the DA threatened to walk away from the Government of National Unity (GNU) over a disagreement with the ANC over the proposed composition of Cabinet.

SA's currency, which was already under pressure in morning trade due to a stronger dollar, weakened to R18.4139/$ before recouping some losses to trade at R18.3915 at 11:10. As recent as last Friday the rand had traded as strong as R17.90/$, near the strongest level in almost a year on optimism the GNU would usher in much needed economic reforms.

"The rand will remain in cautious terrain while the cabinet negotiations play out," Bianca Botes, a director at Citadel Global said in a client note. "With no decision in the bag yet, we can expect the rand to take its cues from the global market."