Rand gains almost 20c on dollar as Mboweni presents ‘austerity’ budget, bonds firm

The rand firmed against major global currencies on Wednesday afternoon, gaining almost 20c against the dollar after finance minister Tito Mboweni promised to slash the public-sector wage bill.

In what it described as “a major step towards fiscal sustainability”, the government proposed cutting expenditure over the next three years by R156.1bn compared with its 2019 projections.

The local currency had been weaker shortly before Mboweni began speaking, but at 2.22pm was 0.29% firmer at R15.17/$, having earlier strengthened to as much as R15.09/$.

The local currency was 0.11% firmer at R16.5322/€ and 0.68% stronger at R19.626/£.

The local currency had been 0.5% weaker at R15​.286/$ shortly before 2pm.

The generic 10-year government bond also firmed, with the yield falling 13 basis points to 8.70%, its best level in about seven months.

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Source: businesslive.co.za