Rand weakens in volatile trade and on Zuma’s free-education rumours
After showing signs of a slight recovery on Thursday‚ the rand surprised the market‚ shedding up to 1% against the dollar in intra-day trade‚ retracting and closing 0.67% weaker.
TreasuryOne dealer Andre Botha‚ said the rand experienced a bit of a fall-out on Thursday‚ partly because of the proposed free-education policy President Jacob Zuma wants to introduce‚ with the market questioning where the money will come from.
At 11.30am‚ the rand was R14.3542 to the dollar from R14.2548‚ at R16.715 to the euro from R16.596‚ and at R18.8935 to the pound from R18.7435.
The euro was at $1.1644 from $1.1642.
Botha said that another factor contributing to the rand’s recent downward swings is that some key technical levels have been broken with each break opening up the scope for further losses. “Overall we have seen very weak sentiment in the local currency and we can expect bad news to be exaggerated with the rand having sudden knee jerks.”