Rand breaches R16/$ mark on bets that Joe Biden may topple Donald Trump

CAPE TOWN – The rand breached the R16/$ mark against the dollar on Wednesday, touching R15.97/$ during intraday trade on the back of a widening gap in the US presidential race between Donald Trump, with Biden leading the charge.

On Tuesday the greenback rebounded from a one-week low as the polls slowly trickled in for counting, showing that Trump and Biden were neck and neck.

At 5pm the domestic currency was bid at R16.02 a dollar, R18.76 to the euro and R20.80 versus the pound.

TreasuryONE currency dealer Andre Botha said with all the volatility going on in the market, anything was possible. “We will need to keep a close eye on what happens. If the US election does not get a clear winner and becomes contested, then we could be in for a rough ride.”

Schroders chief economist Keith Wade did not rule out the prospect of a continuation of the status quo, with a Trump presidency and divided Congress saying this was an outcome that would see less stimulus and the re-ignition of the trade wars, factors that would limit growth.