Rand calmer on Friday morning

Thursday’s weakening of the rand was generally blamed on SA’s third-quarter current account deficit coming in at R176.6bn, a deterioration from R167.4bn in the second quarter.

Peregrine corporate treasury manager Bianca Botes said in a note e-mailed on Thursday night that the “soft” current account figure added to the gloomy outlook on the rand already created by load-shedding and its potential effect on economic growth in 2019 along with parliamentary approval to amend section 25 of the constitution to open the way for land expropriation without compensation.

“Since SA, along with other emerging markets, has high debt which is mostly foreign denominated, the ability to service this foreign debt diminishes as US interest rates rise, putting strain on an already severely strained local fiscus,” Botes said.

The Reserve Bank is scheduled to release November’s foreign exchange reserves on Friday morning, which are expected to have remained at about October’s R50.17bn.

The JSE may halt a two-day slide, judging from a muted rebound in Asian markets on Friday morning after US President Donald Trump indicated a truce in his trade war with China was on again.