Major banking CEO fired, and Tau slams 134-year-old South African company liquidators
The rand weakened on Friday as investors shifted towards safe-haven assets like the US dollar amid escalating tensions in the Middle East.
The conflict involving the US, Israel, and Iran entered its seventh day, with no signs of slowing down.
On Friday, Israel conducted heavy strikes on Hezbollah-controlled areas in Beirut and targeted infrastructure in Tehran, while Iran attacked parts of Tel Aviv.
The rand was trading at 16.72 against the dollar, which is 0.4% weaker than Thursday’s close, aligning with trends observed in most emerging market currencies.
The US dollar rose about 0.2% against a basket of other currencies. Analysts noted that, like many emerging-market currencies, the rand has been impacted by rising global risk aversion and higher oil prices, which are particularly negative for South Africa as a net energy importer.
They indicated that the rand will likely trade within a range of 16.40 to 16.75 per dollar in the near term, as markets await further clarity on both the geopolitical situation and US economic data.
On the Johannesburg Stock Exchange, the Top-40 index fell by 2%. South Africa’s benchmark 2035 government bond weakened significantly, with the yield rising by 19.5 basis points to 8.435%.
In the upcoming week, investors focused on domestic issues will look to the country’s statistics agency for indicators regarding the health of Africa’s most industrialised economy, specifically with the release of GDP results for the mining and manufacturing sectors.
As of Monday, 9 March, the rand is trading at R16.80 to the dollar, R22.41 to the pound, and R19.44 to the euro. Gold is currently valued at $5,125.30 per ounce, while oil prices have risen to $109.40 per barrel.
5 important things happening in South Africa today
African Bank fired: African Bank CEO was fired during a tense directors’ meeting last week, prompted by the group’s weak first-quarter performance and a regulatory error reported to the Prudential Authority. [Business Day]
Tau slams Tongaat BRPs: Minister of Trade, Industry and Competition, Parks Tau, criticised the business rescue practitioners (BRPs) of suspended JSE-listed Tongaat Hulett, claiming they are misusing the Companies Act to push for liquidation contrary to public interest. [Moneyweb]
R50 billion plan to fix roads: The South African National Roads Agency (Sanral) plans to spend over R50 billion on fixing, upgrading, and maintaining the country’s national road infrastructure. This announcement was made during last week’s budget speech, where Sanral presented its 2024/25 Annual Report and 2025/26 Mid-Year Performance Monitoring Report to the Select Committee on Public Infrastructure. [TopAuto]
ChatGPT warning: AI defamation lawsuits are surging globally, and South African law firm Webber Wentzel has warned that platforms may struggle to defend themselves in South Africa. [MyBroadband]
South African exports under pressure: Fruit producers are looking to redirect their produce to India or other Middle Eastern countries through Saudi Arabia due to regional conflict. Exporters noted that this diversion may incur surcharges, and citrus, grapes, pome, and stone fruit must meet new requirements. [News24]
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