Rand and oil prices break record lows due to virus

JOHANNESBURG – The rand and oil prices broke record lows yesterday with the local currency breaching the R17 against the dollar level as coronavirus concerns battered the markets and as investors forecast a large interest rate cut from the SA Reserve Bank (SARB).

Oil prices saw $25 on escalating tensions between Saudi Arabia and Russia.

Economists said foreign investors were also nervous that South Africa’s Monetary Policy Committee (MPC) would announce a large interest rate cut today, which made the rand less appealing.

South Africa is likely to see its interest rates cut by between 25 basis points and 50 basis points by the MPC, economists have forecast.

The rand breached R17 against the dollar in early trade as the sell-off continued. By 5pm the rand was trading 42c lower at R17.05 against the dollar from the previous day’s corresponding period.