The rand declined the most among the world’s major currencies and bonds fell after the South African government unveiled a bailout plan that may strain the nation’s finances.

It sank as much as 2.3%, wiping out this year’s gains, to R14.37/US$. The yield on the nation’s debt due in 2026 jumped 24 basis points to 9.1%.

“The first impression is not so good,” said Cristian Maggio, the London-based head of emerging-market strategy at TD Securities. “I think the market is shocked with the R69-billion bailout for Eskom and the 4.5% deficit target next year, but I’m still assessing whether this is enough to trigger a downgrade.”

A cut to South Africa’s credit rating would see government bonds ejected from the World Government Bond Index and the rand would depreciate between 10% and 15% from current levels, according to Maggio.  — Reported by Dana El Baltaji and Colleen Goko, (c) 2019 Bloomberg LP