The rand took the 2021 Budget speech in its stride on Wednesday, registering only a slight movement as Finance Minister Tito Mboweni delivered unexpected tax-relief announcements in the face of the raging Covid-19 pandemic that has further slowed economic growth.
The rand had kicked off at R14.54 against the dollar and hit R14.49 shortly after Mboweni tabled a budget reflective of the current pandemic-induced austerity.
The rand held steady through the entire speech, having gained about 0.9% against the dollar in intraday trading, as noted by Bianca Botes, executive director at Citadel Global.
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In his speech, Mboweni stated that the state of the deficit remains dire and SA is recording the biggest tax shortfall in its history, which Botes described as worrisome. "The cost of debt is also growing rapidly, representing a risk factor."
The local unit dipped towards R14.50/$ after the speech, but maintained an overall positive response to the Budget.