The South African Rand falls to R19.30 against the US Dollar
The South African Rand falls to R19.30 against the US Dollar. On Thursday, the South African rand hit a three-year low of R19.30 against the US dollar, losing over 2% of its value in afternoon trading as reported by Moneyweb. The currency has weakened by more than 12% since the start of 2022, with experts suggesting the power cuts by struggling state power utility Eskom could worsen in the coming months.
Eskom is imposing scheduled blackouts for more than 10 hours per day for many households and businesses, with even longer outages expected in the southern hemisphere winter.
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Investor sentiment towards the rand has plummeted, pushing the currency to its lowest level since May 2020 on Wednesday and lower again on Thursday, underperforming its emerging market peers.
Rand Merchant Bank analysts say that negative sentiment will continue to drive the currency. Analysts also suggest that Eskom needs to announce a detailed plan to tackle the electricity crisis to instil confidence in investors. On Thursday, President Cyril Ramaphosa answered questions from lawmakers on his government’s efforts to alleviate the power shortage.
Source: Facebook / @SA Reserve Bank