Rand’s losses continue as market awaits Reserve Bank decision

The rand was weaker against major global currencies on Wednesday afternoon, down 0.38% against the dollar for the week, with investor concerns over SA's economic prospects continuing to weigh on the local currency. problems at the power utility Eskom and perceptions of political fragmentation continue to spook investors, analysts said. There are concerns that SA is headed for further credit-ratings downgrades.

“Against this backdrop, the SA Reserve Bank’s monetary policy committee is meeting this week. However, in our view, the MPC will keep interest rates on hold given the domestic risks,” Wapenaar said. The Bank is expected to make its announcement on Thursday. The global environment remains somewhat supportive, with expectations running high that the first phase of the trade deal between China and US will be signed later on Wednesday.

The first phase of the trade deal aims to vastly increase Chinese purchases of US manufactured products, agricultural goods, energy and services.

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