New Eskom scandal, and WeBuyCars in hot water

The South African rand remained stable in early trading on Wednesday, February 12, as investors reacted to comments from U.S. Federal Reserve Chair Jerome Powell regarding interest rate cuts.

The rand traded at 18.50 against the U.S. dollar, close to its closing level of 18.51 on Tuesday.

Powell informed the U.S. Congress that the Federal Reserve is not in a rush to cut interest rates, indicating that a reduction would only be considered if inflation decreases or the job market weakens.

Investors are now awaiting the release of the January consumer price index from the United States.

Like other currencies sensitive to market risk, the rand often follows trends set by global factors, particularly U.S. monetary policy, in the absence of significant local influences.

On Thursday (13 February), the rand strengthened slightly, trading at R18.47 to the dollar, R23.07 to the pound and R19.27 to the euro. Oil is trading lower at $74.41 a barrel.

Here are five other news stories making waves in South Africa today:

Eskom’s scandal: An investigation into procurement fraud at Eskom has revealed that many employees received at least R180 million in kickbacks from “low-value” contracts at major power stations. These contracts, valued at up to R1 million, have less oversight than formal agreements. While designed to speed up decision-making, the Special Investigating Unit (SIU) found they are being misused for corrupt activities. [News24]

Unhappy WeBuyCars customers: The National Consumer Commission (NCC) has received 46 complaints against WeBuyCars during the 2024/25 financial year, primarily alleging that the company provided defective vehicles. NCC spokesperson Phetho Ntaba confirmed these complaints to Moneyweb, noting that these complaints should be viewed in the context that WeBuyCars is one of the largest used vehicle dealers in South Africa. [Moneyweb]

NHI-coloured glasses: Healthcare professionals feel ignored by the government after submitting proposals for a workable and smooth implementation of the National Health Insurance (NHI), which President Cyril Ramaphosa said this week would proceed this year. [Business Day]

South Africa’s debt problem: When Finance Minister Enoch Godongwana delivers his Budget Speech on February 19, it is anticipated that reported tax revenues will fall approximately R10 billion short of initial forecasts, according to Kyle Mandy, the tax policy leader at auditing firm PwC South Africa.[Engineering News]

Water consumption warning: Rand Water says its systems are dropping fast because of extremely high water consumption. The utility says it continues to supply at maximum capacity, but availability is dropping fast. The cities of Johannesburg and Tshwane use the most water. [eNCA]