R1.6 billion ‘missing’ from major city, and Ramaphosa responds to Constitutional Court ruling
South Africa’s markets had a muted end to what was a busy week, digesting both economic and political events.
The rand strengthened on Friday, supported by a weaker dollar, but markets were also left digesting a ruling by the country’s highest court that revived impeachment proceedings against President Cyril Ramaphosa.
The unit ended the week around R16.38 to the dollar, a better position within its relatively tight range, which had held for most of the week.
South Africa’s Constitutional Court on Friday revived impeachment proceedings against Ramaphosa over the “Farmgate” scandal, ruling that parliament had acted unlawfully in blocking the process in 2022.
The case relates to allegations that large sums of foreign currency were stolen from Ramaphosa’s Phala Phala game farm in 2020.
The rand’s strength was also thanks to a weaker dollar, which was weaker against a basket of currencies as markets priced in optimism over a prospective US–Iran peace agreement.
Meanwhile, Central Bank data on Friday showed the country’s net foreign reserves rose to $73.76 billion at the end of April, from $73.19 billion in March.
Next week, South Africa-focused investors will assess unemployment figures, manufacturing production data and mining output, which will shed light on the health of Africa’s most industrialised economy.
5 important things happening in South Africa today
Ramaphosa responds: Following the Constitutional Court’s ruling on Friday, President Cyril Ramaphosa issued a statement acknowledging it and affirming his commitment to the Constitution. He said that no one is above the law, and he would give his full assistance to the processes that will follow. [The Presidency]
R1.6 billion missing: The City of Ekurhuleni said it suffered a “digital state of emergency” where R1.6 billion has yet to be recovered after hackers struck the municipality in a long-term cyberattack. Hackers gained access to the city’s internal systems through its government facilities and then either removed debts or paid themselves by generating invoices. [MyBroadband]
Eskom bonuses as South Africans suffer: Eskom’s decision to pay its employees R5.4 billion in bonuses has come under fire as households and businesses face increasing pressure from rising electricity prices. The Democratic Alliance (DA) has gone so far as to call this a “betrayal”, as the bonuses are funded, in part, by above-inflation electricity price hikes. [Daily Investor]
Hantavirus tracking: The National Department of Health has confirmed that authorities are currently monitoring at least 14 people in South Africa regarding the Hantavirus, one of whom has tests pending after showing symptoms. 10 are being monitored in Joburg and another 4 in the Western Cape. The public has been urged not to panic and avoid comparisons with the COVID-19 pandemic.[BusinessTech]
Oil supply warning: OPEC’s crude production fell to a new 36-year low last month as the Iran war continued to choke off exports from the Persian Gulf and forced further shut-ins, according to a Bloomberg survey. Output from OPEC declined by 420,000 barrels a day to 20.55 million a day in April, the lowest since 1990. [TopAuto]
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