JOHANNESBURG - The South African currency retreated sharply as traders digested sizeable revisions to the medium-term fiscal deficit and debt forecast trajectories to outpace external reprieve offered by a weaker dollar in anticipation of a dovish Fed according to NKC Research.
At the close of local trade, the rand quoted 2.52 percent weaker at R15.01. The local unit regained some composure in after-hours trading as it settled just below the R15-level, but the rand is likely to remain in an enfeebled state ahead of Moody’s credit rating update on South Africa tomorrow. Expected range today R14.85/$ - R15.10/$.
Bianca Botes a Treasury Partner at Peregrine Treasury Solutions said that the rand came under pressure on Wednesday, weakening as much as 2.5 percent against the greenback and breaching R15.00/$
According to Botes, while the MTBPS offered little clarity on the reforms we can expect in the 2020 budget, the increasing state debt burden and growth adjustment saw the rand wipe out all of its recent gains.
South African bourse