Rand at record low ahead of Reserve Bank rates decision

Rand notes. Picture: THINKSTOCK
Rand notes. Picture: THINKSTOCK

The rand was under pressure on Thursday, pushing to a record-low of R17.54/$, as investors turn their focus to the SA Reserve Bank’s interest- rate decision due later in the day.

SA's battles with the Covid-19 pandemic is adding pressure to the local currency, with the number of local transmissions continuing to rise.

Global central banks have responded to the outbreak through quantitative easing and through lower interest rates, with expectations that the Reserve Bank will also lower rates later this afternoon – possibly a 50 basis point cut.

At 11.33am, the rand had weakened 0.45% to R17.2476/$ and 0.36% to R19.9265/£. It had strengthened 0.25% to R18.7291/€. The euro was down 0.45% to $1.0862.

Volatility remained high in global markets and currency swings should be expected to widen, with local news adding pressure to the global crisis, Rand Merchant Bank analyst Nema Ramkhelawan-Bhana said in a note.

“With the government imposing stricter measures to counter the Covid-19 outbreak and public sector workers to receive no increase on April 1, SA is facing the most challenging of circumstances,” she said.