Rand firms to two-week high

The rand strengthened to its highest in two weeks as election results showed the ANC remained well in the lead.

Some analysts have expressed the hope that investor sentiment will be boosted if the ANC secures close to 60% of the vote, which would give President Cyril Ramaphosa enough of a mandate to defy those still loyal to former president Jacob Zuma. Ramaphosa has pledged to reverse a decade of stagnant growth and corruption.

With 80.31% of the vote counted by 10.40am on Friday, the ANC is on 57% the DA on 21.80% and the EFF on 10.10%

The rand is holding firm on the expectation of a neutral-to-positive election outcome, said Rand Merchant Bank analyst Mpho Tsebe, although it was also being lifted by the weaker dollar. “At this stage, the results are more or less in line with the consensus forecasts of the top three, but the provincial split will be more telling.”

At 9.30am on Friday the local currency was 0.67% firmer at R14.2496/$, 0.53% stronger against the euro at R15.9985/€ and 0.64% firmer against the pound at R18.5389/£. The euro gained 0.14% to $1.1228. 

Gold was up 0.12% at $1285.49/oz, while platinum gained 1.33% to $858.93.

Brent crude added 0.93% to $70.86 a barrel. 

The dollar was weaker against most major currencies after the US tariff increase on Chinese goods came into effect on Friday. The US customs and border protection enforced the increase on $200bn of Chinese goods in the early hours of Friday morning, Reuters reported.

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Source: businesslive.co.za