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Rand recovers to below R16 mark as markets shrug off the concerns about new Omicron variant

The rand, on the up, surprised yesterday as it dipped below the R16 mark as the markets shrugged off the latest developments around the Covid-19 Omicron variant and the record unemployment numbers. (AP Photo/Denis Farrell)

The rand, on the up, surprised yesterday as it dipped below the R16 mark as the markets shrugged off the latest developments around the Covid-19 Omicron variant and the record unemployment numbers. (AP Photo/Denis Farrell)

Published Dec 1, 2021

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The rand, on the up, surprised yesterday as it dipped below the R16 mark as the markets shrugged off the latest developments around the Covid-19 Omicron variant and the record unemployment numbers.

Statistics South Africa yesterday revealed that the unemployment rate had escalated to 34.9 percent in the three months to September, the highest level since 2008.

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Stats SA said 660 000 people lost their jobs during the third quarter, with the number of discouraged work seekers dramatically increasing by 545 000.

There are more than 7.6 million people of working age who are unemployed in South Africa.

Despite this, the rand made a spectacular recovery following a retreat to R16.21 to the dollar earlier in the day as caution lingered in markets after Omicron sent the world in a panic.

After starting the day at R16.11 to the dollar, the rand was unfazed by the unemployment reading, strengthening by 0.22 percent to R15.94 to the greenback by 5pm.

Meanwhile, the domestic markets also pushed back against the risk off sentiment that spooked international markets after drugmaker Moderna warned about the Omicron variant.

Moderna chief executive Stéphane Bancel sent the markets tumbling after predicting that existing vaccines could be much less effective at tackling Omicron.

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He also warned it would take months before pharmaceutical companies could manufacture new variant-specific jabs at scale.

However, news that the Dutch health authority had found the Omicron variant in two local cases, going back 11 days before it was first detected in South Africa, calmed the local bourse while jolting international markets.

The JSE All Share Index was up 0.67 percent to 70 475 index points, not far from recent record highs, mainly supported by miners and pharmaceuticals.

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Aspen Pharmacare jumped 6.26 percent to R238.26 per share after it entered into advanced discussions over a potential licensing agreement to package the Covid-19 vaccine in South Africa.

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