New!Daily live updates: important information about the coronavirus pandemicRead More
South African rands and American dollars
South African bank notes featuring images of former South African President Nelson Mandela (R) are displayed next to the American dollar notes in this photo illustration in Johannesburg.

South Africa’s rand weakens as virus dents risk appetite

1 Mins read

South Africa’s rand weakened early on Friday as concerns over the economic damage cause by the COVID-19 pandemic knocked risk appetite, outweighing news that Africa’s most advanced nation will allow a partial reopening of the economy on May 1.

At 0645 GMT, the rand traded at 19.1400 per dollar, 0.21% weaker than its previous close.

South African President Cyril Ramaphosa said on Thursday that from May 1 the government will allow some industries allowed to operate under a five-level risk system.

South Africa has spent nearly a month under restrictions requiring most of the population to stay at home apart from essential trips, leaving many businesses and individuals struggling.

“The news has had no impact on the rand … as global risk aversion and the impending rebalancing of the World Government Bond Index weigh on the currency”

said Andre Botha, senior dealer at TreasuryONE.

South Africa will fall out of the benchmark World Government Bond Index (WGBI) at the end of April after Moody’s revoked the country’s last investment grade rating in March.

The rebalancing will probably lead to a further selloff in South African bonds. More than 50 billion rand ($2.62 billion)has already exited South African bonds in 2020.

Government bonds were also weaker in early trade, with the yield on the 10-year instrument due in 2030 rising 6 basis points to 10.910%.

($1 = 19.1081 rand)

Related posts

Why Botswana’s Rising Inflation should worry you

2 Mins read
Inflation shaves off your real income. But despite being specifically tasked with reining in inflation, the government is moving at slow pace.
FinanceSouth Africa

South Africa’s continuing economic pandemic

4 Mins read
Grant top-ups and the new social relief of stress grant must be extended beyond October as crucial indicators show that the country’s economic prospects remain grim.

Stanbic Bank Botswana Launches Contactless Debit and Credit Cards

2 Mins read
GABORONE – Stanbic Bank Botswana has launched contactless debit and credit cards, which allow customers to tap their cards to complete a payment…
Be the first to get news!

We take you inside the companies and the topics that matter to you.

Leave a Reply

Your email address will not be published. Required fields are marked *

World Health Organization

World Health Organization guidance helps detect iron deficiency and protect brain development