The rand was hovering around R13/$ on Wednesday morning as the market waited to see how the drama between President Jacob Zuma and Finance Minister Pravin Gordhan would play out.
Much coverage has been devoted to the rand’s swing from R12.32/$ to R13.05/$‚ after Zuma ordered Gordhan to return from an investor road show in London.
Perhaps more alarming is the 42 basis point rise to 8.73% on the yield on government’s benchmark R186 bonds.
According to Trading Economics‚ South African government debt is about $53.8 billion‚ so Zuma’s move has added about $202 million (around R2.6 billion) to the government’s annual interest bill.
Winners in the rapidly sinking rand include synthetic oil producer Sasol whose share price jumped 5.89% to R382.21 on Tuesday.
Budget 2017: Gordhan warns against interfering with the Treasury
The JSE’s miners generally benefited from the weaker currency‚ led by African Rainbow Minerals‚ which gained 8.28% to R94.80.
The sale of Naspers’s 36.4% stake in Souq.com to Amazon.com helped its shares rise 3.11% to R2‚305.49 on Tuesday.
JSE on tenterhooks for Tuesday’s episode of ‘state capture’ soapie
Telkom — for reasons that are not clear since it is not a rand hedge — jumped 5.67% to R76.27 on Tuesday.
The funeral of struggle hero Ahmed Kathrada on Wednesday morning is likely to divert attention away from the unfolding drama in South African politics for a few hours. -Tiso Black Star Group/BDLive
