Market retreats most in two months on rates decision

JOHANNESBURG – THE MARKET dove into the red yesterday with the JSE falling the most in almost two months dragged by the decline in retailers and banks after the SA Reserve Bank (SARB) raised its inflation forecasts for this year.

The JSE All Share Index fell 0.73 percent to 64 783 index points, its lowest level since February 5, as fears over renewed lockdown restrictions will weaken the momentum in economic recovery.

The rand also pared early gains while stocks traded at a near 2-month low, weakening 0.2 percent to R15.06 against the dollar by 5pm as the looming third wave of Covid-19 infections and possible tighter restrictions drove traders to the dollar.

Analysts forecast that an appreciating collar could push the rand towards R15.17 and R15.35 in the near term.

The third wave of Covid-19 infections is expected to hit South Africa some time in April, and the mooted lockdown ahead of the Easter weekend could further derail any economic recovery.

Source: iol.co.za