Rand weaker as black­outs be­gin

The Mercury - - BUSINESS REPORT -

THE RAND was weaker yes­ter­day after dis­ap­point­ing min­ing data and as strug­gling state power firm Eskom started con­trolled elec­tric­ity out­ages, be­cause of a wage dis­pute with labour unions. At 5pm the rand was bid at R13.3291 to the dol­lar. – Reuters

THE RAND was weaker yes­ter­day after dis­ap­point­ing min­ing data and as strug­gling state power firm Eskom started con­trolled elec­tric­ity out­ages be­cause of a wage dis­pute with labour unions.

At 6.35pm, the rand traded at R13.37 to the dol­lar, 0.5 per­cent weaker and not far from a six­month low of R13.44 struck on Wed­nes­day.

At 5pm the rand had bid at R13.3291 to the dol­lar, 9.08 cents softer than at the same time on Wed­nes­day.

South African as­sets have been hurt re­cently by weak eco­nomic fig­ures and an un­favourable ex­ter­nal back­drop which has seen global in­vestors pull back from emerg­ing mar­kets.

Data show­ing that min­ing out­put fell 4.3 per­cent in April came after same month re­tail sales un­der­shot expectations and first-quar­ter gross do­mes­tic prod­uct con­tracted by 2.2 per­cent.

These data points have added to ev­i­dence that the econ­omy is yet to pick up mo­men­tum fol­low­ing Cyril Ramaphosa’s takeover of the pres­i­dency in Fe­bru­ary.

Ramaphosa has courted in­vestors with prom­ises to woo in­vest­ment and root out cor­rup­tion, but he faces an up­hill bat­tle to get the econ­omy fir­ing on all cylin­ders after a decade of stag­na­tion un­der his pre­de­ces­sor, Ja­cob Zuma.

That task be­came harder yes­ter­day, when Eskom – which pro­duces more than 90 per­cent of the coun­try’s power – started con­trolled out­ages as protest­ing union mem­bers dis­rupted coal sup­plies and blocked some staff from go­ing to work.

Labour unions have threat­ened a to­tal shut­down of Eskom’s op­er­a­tions un­less it meets their de­mands for a 15 per­cent in­crease in salaries.

The last time Eskom had to re­sort to con­trolled power out­ages in 2015, eco­nomic out­put was af­fected.

Mean­while, stocks were mixed yes­ter­day, with bourse heavy­weight Naspers un­der pres­sure while banks were in de­mand.

The JSE Top40 in­dex edged down 0.04 per­cent to 52 178.24 points, while the broader all share in­dex inched up 0.1 per­cent to 58 495.67 points.

Naspers dropped 1.71 per­cent to close at R3 335.

FirstRand gained 3.47 per­cent to R63.22, while Bar­clays Africa

Group rose 1.82 per­cent to R165.68.

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