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Rand leads world currency losses as Zuma survives ouster vote

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21:47

Bloomberg - The rand led declines among major currencies after President Jacob Zuma survived a bid by opposition lawmakers to oust him, crushing the prospect of new leadership reviving the country’s economy.

The South African currency dropped 1.3% to R13.40 by 21:45. Yields on the country’s $2bn of Eurobonds due October 2028 were little changed after the vote at 4.75%.

The ruling African National Congress defeated an eighth attempt in Parliament to remove Zuma, whose eight-year rule has been mired in allegations of corruption and mismanagement that weighed on investor sentiment, reduced the country’s credit ratings to junk and sent the economy into recession.

“While the outcome is in line with our and market expectations, the result still leaves room for disappointment as some had hoped that a vote of no-confidence would lead to a more credible government and the introduction of market-friendly reforms,” Trieu Pham, London-based emerging-markets credit strategy analyst at MUFG Securities, said via email.

“Politics will remain in focus as we get closer to the ANC National Conference” in December, when the party will elect a new leader.

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