South African billionaire’s company fined, and CEO sends a warning about the United States
South Africa’s risk-sensitive rand was steady on Friday as investors followed developments in the Middle East after US President Donald Trump’s decision to postpone attacks on Iran’s energy infrastructure.
The rand traded at 17.12 against the dollar, little changed from its previous close of 17.1150.
ETM Analytics said the currency is expected to remain on the defensive as the U.S.-Israeli war on Iran weighs on risk sentiment.
Trump said on Thursday he would postpone attacks on Iran’s energy plants for 10 days at Tehran’s request and that talks with Tehran were going “very well”.
However, reports that the US president was considering sending more troops added to concern about the war escalating into a ground conflict, with no certainty that the Strait of Hormuz could be reopened to shipping soon.
“The South African Reserve Bank will have a lot to consider in the coming months and will need to constantly walk a fine line between containing inflation expectations and not disrupting the country’s Gross Domestic Product growth dynamic,” said ETM Analytics.
The central bank kept its policy rate at 6.75% on Thursday, saying caution was needed. On the Johannesburg Stock Exchange, the Top-40 index (.JTOPI) was last down 1.2%.
South Africa’s benchmark 2035 government bond also weakened, with the yield rising 19.5 basis points to 9.185%.
As of Saturday, 28 March, the rand is trading at R17.12 to the dollar, R22.72 to the pound, and R19.77 to the euro. Gold is currently valued at $4,445.95 per ounce, while oil prices have risen to $112.57 per barrel. [Reuters]
5 important things happening in South Africa today
Cartrack fine: The National Consumer Commission (NCC) and Cartrack have reached a settlement agreement, with the latter paying an administrative fine of R5 million and refunding over R5.1 million to affected consumers. This was due to the sale agreements not being consistent with the Consumer Protection Act. Cartrack is owned by Karooooo, which South African billionaire Zak Calisto founded. [MyBroadband]
Don’t provoke the US: Kganki Matabane, CEO of the Black Business Council, has warned South Africa not to play tit-for-tat with the US, arguing that it would be better to wait until Trump’s term runs its course by 2029. He added that the next administration will likely be less hostile. [BusinessDay]
Interest rate hikes on the cards: The South African Reserve Bank (SARB) is expected to raise interest rates at its May and July Monetary Policy Committee (MPC) meetings. This is the view of Morgan Stanley economist Andrea Masia, who pencilled in two 25-basis-point hikes this year, followed by a pause and a resumption of easing in 2027. [Bloomberg]
Chinese cars wanted: Deputy President Paul Mashatile has sought to get Chinese firms to increase investment in South Africa’s renewable energy and automotive sectors. This includes electric vehicle (EV) production and battery manufacturing, which he said would help build the country as the “next generation” of vehicle production and boost localisation. [News24]
R3 million police bill under investigation: Payments totalling R3 million are under investigation due to question marks over their intended use. The payments were allegedly made after a note was sent stating they were for protecting President Cyril Ramaphosa, but those officers may not have been involved in his security. [Daily Maverick]
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