The rand briefly broke below R14.00 to the US dollar following the news that Parliament's portfolio committee on public works withdrew its expropriation bill on Tuesday.
The public works committee said in a short statement that it "officially resolved, in accordance with Joint Rule 208 (2), to reject (withdraw) the Expropriation Bill [B4D of 2015] so that it may be re-introduced at a later stage". The bill is separate to the review of section 25 of the Constitution currently under way to make it possible for the state to expropriate land without compensation.
The rand, which immediately firmed to R13.95/$, returned to trade 0.06% firmer at R14.15 to the greenback by 17:13 in Johannesburg.
Important to note is that the expropriation bill existed before the latest processes on land expropriation and was referred back to Parliament by former president Jacob Zuma, who said consultation around the bill was inadequate.
Zuma returned the bill to parliament in 2017 due to inadequate public participation for the bill.
During its December conference, the ANC and its delegates agreed that expropriating land without compensation should be among mechanisms to effect land reform.
The condition was that expropriation should not undermine the economy, agricultural production and food security.
The constitutional review committee is due to report back to Parliament regarding its findings from the nationwide hearings on expropriation soon.