Rand leads EM currency gains as traders digest Ramaphosa speech

accreditation
A rand note (iStock)
A rand note (iStock)

The rand led gains among emerging-market currencies on Friday as investors assessed President Cyril Ramaphosa’s pledges to overhaul South Africa’s electricity industry and curb government spending.

While offering little that is new on the planned restructuring of Eskom, Ramaphosa announced sweeping measures Thursday to address power shortages and reduce dependence on the debt-stricken utility.

He warned that the nation’s debt trajectory is unsustainable and said Finance Minister Tito Mboweni will announce spending cuts in the Budget on February 26, with the government and labour unions in talks to reduce the state wage bill.

The rand climbed 0.7% to 14.8506 per dollar by 13:34*, heading for its best weekly performance this year. Yields on 10-year sovereign dollar bonds dropped two basis points to 4.66%, the lowest level on a closing basis since September 6.

“The speech touched on a broad range of domestic concerns, ranging from electricity supply, state-owned enterprises, youth unemployment, climate change and access to education,” said Siobhan Redford, a Johannesburg-based analyst at FirstRand Bank. “It is fair to say the president hit all the right notes in his annual song to the people of the South Africa, but many will want to see action before buying into the promises.”

* Fin24 has updated the Bloomberg article to show the currency's latest gains. 

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For 14 free days, you can have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today. Thereafter you will be billed R75 per month. You can cancel anytime and if you cancel within 14 days you won't be billed. 
Subscribe to News24
Rand - Dollar
17.63
+1.2%
Rand - Pound
20.24
-0.2%
Rand - Euro
17.61
-0.4%
Rand - Aus dollar
11.46
+1.4%
Rand - Yen
0.12
+0.8%
Gold
1,725.20
+1.5%
Silver
21.03
+1.5%
Palladium
2,310.39
+3.9%
Platinum
934.70
+3.3%
Brent Crude
88.86
+4.2%
Top 40
59,840
+3.3%
All Share
66,313
+3.2%
Resource 10
64,568
+4.5%
Industrial 25
80,073
+3.2%
Financial 15
14,053
+1.7%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

LEARN MORE
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders