Rand softer on Trump’s tweet, JSE higher

THE RAND was trounced by the dollar yesterday after a tweet by US President Donald Trump about South Africa’s land debate planted thoughts of possible sanctions against the country.

The currency weakened 1.7 percent after Trump said he had asked Secretary of State Mike Pompeo “to closely study the South Africa land and farm seizures and expropriations”, according to Bloomberg.

TreasuryOne senior currency dealer, Andre Botha, said President Cyril Ramaphosa had addressed some of the issues regarding the land reform in Parliament.

“Key among which is that he does not support nationalisation of land and that the process of redistribution will be done in an orderly fashion, with land owned by the state and municipalities that are not used or underutilised being earmarked for the redistribution.”

This was expected to alleviate some fears among investors and the rand to continue on its strengthening path during the session.

“Furthermore, the US Fed minutes did not indicate a desire from the Fed hike rates quicker than their forward guidance suggests. This has nibbed some of the calls for higher rates faster in the bud,” said Botha.

By 5pm, the rand was largely unchanged against the dollar at R14.29 compared with Wednesday’s same time bid. Against the pound, the rand was 11 cents stronger at R18.34 and to the euro, the currency firmed by 4c to R16.54.

Corporate treasury manager at Peregrine Treasury Solutions, Bianca Botes, said Ramaphosa’s announcement that the first step in the land redistribution process would be for government to issue the land held by the state provided welcome relief to the market, assisting the rand to trade stronger.

Meanwhile, JSE stocks were unperturbed by all the ‘Trum- ponomics’ drama with the blue chip Top40 index gaining 0.13 percent to 52 131.76 points, while the broader all share index inched up 0.14 percent to 58 204.72 points.

Leading gainers among major movers were Clicks, which gained 5.49 percent to R196.80, Curro, up 4.98 percent to R33.70 and South32, which added 4.05 percent to R36.73.

The biggest losers were Exxaro, down 6 percent to R147 and African Rainbow Minerals, which fell 4.2 percent to R123.75. Anglo American retreated 3.2 percent to R283.97. – Business Report Online.