Johannesburg - The rand led emerging-market currency gains against the dollar as reports of a meeting by top officials of the ruling African National Congress fuelled speculation Jacob Zuma’s days as president are numbered.
The currency climbed as much as 0.9% before paring the gain to trade 0.41% stronger at R12.12 to the dollar by 14:33 in Johannesburg. Yields on rand-denominated government bonds fell 1 basis point to 8.45%.
South African assets have rallied since Deputy President Cyril Ramaphosa was elected leader of the ANC in December, setting him on a path to take over as head of state from Zuma, whose nine-year administration has been mired in mismanagement, corruption and stagnant growth.
Ramaphosa had pledged to root out graft and confront fiscal challenges to help revive an economy that’s struggling to emerge from last year’s technical recession.
“The political dynamic is progressing in a healthy direction,” Morgan Stanley analysts Min Dai and Andrea Masia wrote in a client note.
“South Africa offers one of the best stories in emerging markets in 2018: political change, economic recovery, attractive valuation and favourable technicals.”
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