{"id":319942,"date":"2019-05-29T08:00:12","date_gmt":"2019-05-29T06:00:12","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=319942"},"modified":"2019-05-29T08:44:00","modified_gmt":"2019-05-29T06:44:00","slug":"the-rand-has-been-hit-by-the-perfect-storm","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/finance\/319942\/the-rand-has-been-hit-by-the-perfect-storm\/","title":{"rendered":"Rand hit by &#8216;the perfect storm&#8217;"},"content":{"rendered":"<p>The rand slumped to a seven-month low on Tuesday (28 May) as an unexpected delay in the appointment of the cabinet stoked concerns that President Cyril Ramaphosa is facing opposition to his reform agenda.<\/p>\n<p><strong><a href=\"https:\/\/www.bloomberg.com\/news\/articles\/2019-05-28\/it-s-the-opposite-of-ramaphoria-as-mabuza-effect-roils-rand\" target=\"_blank\" rel=\"noopener noreferrer\">Bloomberg<\/a> <\/strong>reports that the currency\u2019s slide started when the ruling ANC confirmed David Mabuza would be sworn in as a lawmaker, opening the way for him to be reappointed as deputy president.<\/p>\n<p>It then gathered momentum as investors speculated about the composition of the executive.<\/p>\n<p>&#8220;Investors worry that Ramaphosa will not be able to root out corruption from the top echelons of the government as promised, endangering his reform agenda,\u201d said Per Hammarlund, the Stockholm-based chief emerging-market strategist at SEB AB.<\/p>\n<p>&#8220;The rand could reverse declines if Mabuza shows commitment to reform measures,&#8221; he said.<\/p>\n<p>&#8220;Buy the rumour and sell the fact is in full effect right now,&#8221; added Wichard Cilliers, a trader at TreasuryOne Ltd. in Johannesburg.<\/p>\n<p>&#8220;It\u2019s putting the rand under pressure because investors thought there was a chance that the cabinet would be cleaner. But we need to see the official news about Mabuza, the real deal about what his role will be,&#8221; he said.<\/p>\n<p><a  data-lightbox=\"post-image\" href=\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2019\/05\/Bloomberg-rand.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-319944 aligncenter\" src=\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2019\/05\/Bloomberg-rand.jpg\" alt=\"\" width=\"814\" height=\"457\" srcset=\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2019\/05\/Bloomberg-rand.jpg 814w, https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2019\/05\/Bloomberg-rand-300x168.jpg 300w, https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2019\/05\/Bloomberg-rand-768x431.jpg 768w\" sizes=\"auto, (max-width: 814px) 100vw, 814px\" \/><\/a><\/p>\n<p><strong>Perfect storm<\/strong><\/p>\n<p>According to Bianca Botes, corporate treasury manager at Peregrine Treasury Solutions, the rand has also not been helped by the US-China, US-Iran and Brexit dynamics.<\/p>\n<p>Combined these factors have created the &#8216;perfect storm&#8217; for emerging markets, she said.<\/p>\n<p>&#8220;The rand quickly broke through key technical levels on Tuesday, declining 2% against the greenback to reach R14.71\/$ during the day, as market participants sold ZAR as a proxy for other emerging market currencies.<\/p>\n<p>&#8220;The risk-off environment is likely to continue throughout today and with no key data due for release geopolitical factors will remain the key focus,&#8221; she said.<\/p>\n<p>The rand was trading at the following levels at 07h40 on Wednesday morning:<\/p>\n<ul>\n<li>R14.72\/dollar (+0.11%);<\/li>\n<li>R16.44\/euro (+0.07%);<\/li>\n<li>R18.64\/pound (+0.04%).<\/li>\n<\/ul>\n<hr \/>\n<p><strong>Read: <a href=\"https:\/\/businesstech.co.za\/news\/finance\/319558\/how-much-south-africans-could-lose-due-to-the-new-expat-tax\/\" target=\"_blank\" rel=\"noopener noreferrer\">How much South Africans could lose due to the new expat tax<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The rand slumped to a seven-month low on Tuesday (28 May) as an unexpected delay in the appointment of the cabinet stoked concerns President Cyril Ramaphosa is facing opposition to his reform agenda.<\/p>\n","protected":false},"author":10,"featured_media":114834,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11121],"tags":[26,12603],"class_list":["post-319942","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance","tag-headline","tag-peregrine-treasury-solutions"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/319942","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\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=319942"}],"version-history":[{"count":4,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/319942\/revisions"}],"predecessor-version":[{"id":319976,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/319942\/revisions\/319976"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/114834"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=319942"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=319942"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=319942"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}