{"id":264329,"date":"2018-08-13T07:36:55","date_gmt":"2018-08-13T05:36:55","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=264329"},"modified":"2018-08-13T07:36:55","modified_gmt":"2018-08-13T05:36:55","slug":"rand-hit-by-steepest-drop-in-almost-a-decade","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/finance\/264329\/rand-hit-by-steepest-drop-in-almost-a-decade\/","title":{"rendered":"Rand hit by steepest drop in almost a decade"},"content":{"rendered":"
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South Africa\u2019s rand plunged the most in almost a decade and Mexico\u2019s peso slumped as financial turmoil in Turkey sapped demand for emerging-market assets.<\/p>\n

The two currencies fell along with their developing-nation peers as Turkey\u2019s lira tumbled for a fourth day after President Recep Tayyip Erdogan showed no signs of backing down in a standoff with the U.S. administration. As investors worry about the country sliding toward a full-blown financial crisis, traders are trimming their holdings of developing-nation securities.<\/p>\n

The lira\u2019s slide \u201cmay fuel volatility in emerging-market assets and dampen investor sentiment in the near term, as markets are already skittish,\u201d said Kerry Craig, global market strategist at J.P. Morgan Asset Management in Melbourne. \u201cBut the drivers of the lira\u2019s decline are very specific to Turkey -\u2013 therefore it should not derail the positive fundamentals in other emerging markets over a longer term.\u201d<\/p>\n

Investors were already cautious about emerging markets as the prospect of a global trade war compounded concerns about a more hawkish Federal Reserve and European Central Bank. In South Africa, uncertainty about the ruling party\u2019s policies on land and mining has also contributed to the rand slumping more than 15% decline against the dollar this year.<\/p>\n

The rand was 4% lower at R14.6617 per dollar as of 12:55 pm in Tokyo on Monday after sliding as much as 9.4%, the most since October 2008. Mexico\u2019s peso slid as much as 2.3%, the biggest decline since January 2017.<\/p>\n

\u201cThe rand should continue to be influenced by the Turkish lira crisis through the sentiment channel,\u201d Societe Generale SA strategist Jason Daw wrote in a research note.<\/p>\n

\u201cUntil the lira stabilizes, the prospects for the South African currency are not encouraging.\u201d<\/p>\n

Emerging Asian foreign-exchange markets were also hit, though to a lesser degree. India\u2019s rupee dropped to a new record low, while the Indonesian rupiah slumped 0.9%.<\/p>\n

Healthy foreign-exchange reserves and robust fundamentals mean Asia\u2019s emerging economies are in a strong position to withstand any external shocks, said Trinh Nguyen, a senior economist for emerging-market Asia at Natixis Asia Ltd. in Hong Kong.<\/p>\n

\"\"<\/a><\/p>\n

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Read: 6 reasons why the rand is getting hammered<\/a><\/strong><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

South Africa\u2019s rand plunged the most in almost a decade and Mexico\u2019s peso slumped as financial turmoil in Turkey sapped demand for emerging-market assets.<\/p>\n","protected":false},"author":59,"featured_media":263727,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11121],"tags":[26],"class_list":["post-264329","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/264329","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=264329"}],"version-history":[{"count":1,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/264329\/revisions"}],"predecessor-version":[{"id":264337,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/264329\/revisions\/264337"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/263727"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=264329"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=264329"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=264329"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}