{"id":584134,"date":"2022-05-07T11:16:58","date_gmt":"2022-05-07T09:16:58","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=584134"},"modified":"2022-05-07T11:16:58","modified_gmt":"2022-05-07T09:16:58","slug":"the-rand-has-gone-from-darling-to-dud","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/finance\/584134\/the-rand-has-gone-from-darling-to-dud\/","title":{"rendered":"The rand has gone from darling to dud"},"content":{"rendered":"

South African assets have turned from market darlings to duds.<\/p>\n

The rand, bonds and stocks had a flying start to the year, benefitting as a relative haven among emerging markets and from a rise in commodity prices spurred by Russia\u2019s invasion of Ukraine.<\/p>\n

But sentiment has soured.<\/p>\n

The nation\u2019s assets have gone into retreat as investors assess rising global interest rates, after hikes from the U.S. Federal Reserve and the Bank of England this week. Concerns are also growing over inflation, as well as surging Covid cases in China, and what restrictions imposed by Beijing to fight the virus may mean for the world economy.<\/p>\n

These charts illustrate the reversal in South African markets:<\/p>\n

<\/picture><\/figure>\n

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The rand is on track for a third week of declines, the longest losing streak since November. Its 8.5% decline over the past month — pushing it beyond the psychological level of 16 per dollar — makes the currency the worst performing in emerging markets.<\/p>\n

But some analysts, including those at Societe Generale and Anchor Capital, believe the losses have gone too far.<\/p>\n

\u201cThe commodity support has not gone away, and South Africa reported a healthy trade surplus in March,\u201d said Nolan Wapenaar, co-Chief Investment Officer at Anchor Capital. \u201cRate hikes will also continue to bolster the case for the rand, and we maintain our view that the local currency might be able to creep stronger again.<\/p>\n

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

And South Africa\u2019s rand debt hasn\u2019t fared much better.<\/p>\n

Non-residents were set to be net sellers of the nation\u2019s government securities for the first week since March. By Thursday, foreigners had sold R8.6 billion ($536 million) of bonds, based on settled trades data from exchange operator JSE Ltd.<\/p>\n

Local-currency-denominated government debt headed for a sixth week in a row of losses, its worst run in eight months.<\/p>\n

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

South African stocks have felt investors\u2019 aversion to risk more sharply than their emerging-market peers, sliding toward the worst weekly slump since October 2020.<\/p>\n

Johannesburg\u2019s benchmark FTSE\/JSE Africa All Share Index deepened this week\u2019s selloff beyond 6%, a steeper retreat than MSCI\u2019s index of developing country stocks, which is down about 4%.<\/p>\n

More than 90% of the South African benchmark equity gauge\u2019s members were lower on Friday afternoon, helping to make it one of the three worst-performers globally this week in dollar terms among more than 90 major indexes tracked by Bloomberg<\/p>\n

\n

Read: South African stocks take a hammering in worst week since 2020<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

South African assets have turned from market darlings to duds.<\/p>\n","protected":false},"author":59,"featured_media":271497,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11121],"tags":[26],"class_list":["post-584134","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\/584134","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=584134"}],"version-history":[{"count":1,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/584134\/revisions"}],"predecessor-version":[{"id":584142,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/584134\/revisions\/584142"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/271497"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=584134"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=584134"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=584134"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}