The rand was little changed on Friday morning‚ but maintained a weaker bias at the end of a week in which local politics took priority over economic data.
The local currency suffered a setback earlier in the week after Public Protector Busisiwe Mkhwebane recommended that the Reserve Bank’s mandate be adjusted‚ prompting a backlash from various quarters.
Mkhwebane said the central bank should seek to promote economic growth rather than preserve the value of the currency‚ a recommendation both Parliament and the Bank intend to take on legal review.
The rand fell as much as 2% in the immediate aftermath of the comments before regaining some ground on Thursday as the spotlight turned to the Constitutional Court’s ruling on a secret ballot in a no-confidence motion.
Opposition parties led by the United Democratic Movement (UDM) approached SA’s highest court to ask that the motion against President Jacob Zuma be conducted via secret ballot.
The no-confidence motion follows Zuma’s controversial Cabinet reshuffle in March‚ which sullied the country’s investment grade status.
“The ruling that the speaker of Parliament has the discretion to decide how the no-confidence vote will be held all but eliminates any possibility of a secret ballot and therefore any probability of the motion being passed‚” Rand Merchant Bank currency strategist John Cairns said in a note.
“Attention now is on when the vote will be held — our guess is in the next six weeks or so. The market will continue to watch the issue‚ in hope more than expectation.”
At 9.01am‚ the rand was at R12.9403 to the dollar from Thursday’s R12.9719. It was at R14.4690 to the euro from R14.4653‚ and at R16.4792 to the pound from R16.4524.
The euro was at $1.1180 from $1.1152.
Rand holds steady near the end of an eventful week
The local currency suffered a setback earlier in the week after Public Protector Busisiwe Mkhwebane recommended that the Reserve Bank’s mandate be adjusted‚ prompting a backlash from various quarters.
Mkhwebane said the central bank should seek to promote economic growth rather than preserve the value of the currency‚ a recommendation both Parliament and the Bank intend to take on legal review.
The rand fell as much as 2% in the immediate aftermath of the comments before regaining some ground on Thursday as the spotlight turned to the Constitutional Court’s ruling on a secret ballot in a no-confidence motion.
Opposition parties led by the United Democratic Movement (UDM) approached SA’s highest court to ask that the motion against President Jacob Zuma be conducted via secret ballot.
The no-confidence motion follows Zuma’s controversial Cabinet reshuffle in March‚ which sullied the country’s investment grade status.
“The ruling that the speaker of Parliament has the discretion to decide how the no-confidence vote will be held all but eliminates any possibility of a secret ballot and therefore any probability of the motion being passed‚” Rand Merchant Bank currency strategist John Cairns said in a note.
“Attention now is on when the vote will be held — our guess is in the next six weeks or so. The market will continue to watch the issue‚ in hope more than expectation.”
At 9.01am‚ the rand was at R12.9403 to the dollar from Thursday’s R12.9719. It was at R14.4690 to the euro from R14.4653‚ and at R16.4792 to the pound from R16.4524.
The euro was at $1.1180 from $1.1152.
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