Rand slumps to 1-year low, JSE falls
THE RAND slipped to a one-year low yesterday as fears of a ratings downgrade resurfaced on reports President Jacob Zuma was preparing to introduce free tertiary education, which would put added pressure on public finances.
The rand was 0.58 percent weaker against the dollar at R14.3225 as of 5.40pm, after earlier being down more than 1 percent to a session low of R14.42 – a level last hit on November 21 last year.
The government was considering a range of budget cuts that could include slashing social grants for the most vulnerable in order to pay for free tertiary education, a newspaper reported yesterday.
South Africa is staring down the barrel of ratings downgrades after the Treasury last month widened budget deficit estimates and lowered this year’s economic growth forecast.
Stocks were weaker. The benchmark JSE Top40 index retreated 0.17 percent to 53 424.93 points, while the broader all share index slid 0.14 percent to 59 776.12 points.
in which the state owns a stake of around 40 percent, fell 6.39 percent to R50.50. – Reuters