The Rand rallied yesterday as investors cheered a constitutional court ruling that parliament could hold a secret ballot in a no-confidence vote against President Jacob Zuma, who has said such a vote would be unfair. By 6pm the rand gained 0.7percent to R12.9950 to the dollar, dipping below R13 for the first time since Monday.
Despite data signalling the economy could bounce back from recession, investor sentiment has been clouded by political turbulence. The rand slipped to a three-week low on Monday as a government anti-graft body recommended a change to the central bank’s mandate on targeting currency and inflation stability.
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A push back from the bank and yesterday’s court ruling on a no-confidence vote eased investor concerns, lifting demand for the currency. Wichard Cilliers, chief dealer at Treasury One, said anticipation of the court ruling lured buyers to the rand and helped shake off sluggish demand for emerging market assets. Meanwhile, shares dipped. The benchmark JSE Top40 index fell 0.59percent to 44944.65 points, while the all share index was down 0.64percent to close at 51072.86 points.
“The market has been fairly negative, we’ve had our futures edging down all day and basically people have been selling off the rest of the market,” said Cratos Capital stock broker, Yusuf Mola. Caxton and CTP Publishers and Printers dropped 6.77percent to R11.16 after the Competition Tribunal rejected Caxton’s application for leave to intervene in hearings about the merger between Media24 and Novus Holdings.