Rand recovers somewhat after tumbling earlier as global risk aversion set in

The rand regained some lost ground against the dollar at midday on Wednesday after tumbling about 65c against the dollar‚ in line with other emerging-market currencies‚ following the shock victory of Donald Trump in the US presidential election.

Market shockwaves subsided after Hillary Clinton conceded the US election to Trump‚ and Trump made a conciliatory victory speech‚ saying he would like to heal divisions in the US.

Trump said growth in the economy and infrastructure construction would be a major priority during his presidency.

The prospect of a Trump presidency caught markets off guard. The Mexican peso plummeted 13% and the dollar was sharply weaker against the Japanese yen and euro.

Safe-haven currencies such as the Swiss franc‚ as well as gold‚ firmed on the Trump victory.

At 11.29am‚ the rand was at R13.4970 to the dollar from Tuesdays R13.1828. It was at R14.94 to the euro from R14.5368 and R16.7369 to the pound from R16.3267.

The euro was at $1.1072‚ from $1.1026.

Head of currency dealing and director at Treasury One Wichard Cilliers said there was a dash for safe-haven assets such as the Japanese yen‚ which gained against the dollar.

"It seems for now that less risk with a side order of aversion is leading market sentiment this morning.

What comes back to mind in this moment of confusion is the knee-jerk reaction that was seen with the Brexit saga‚ following which the markets then found some footing after fully digesting what the whole situation entails‚" said Cilliers.