South African rand plummets after surprise rate cut, market uncertainty

PUBLISHED: Wed, 15 Apr 2020 14:50:13 GMT
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The South African rand fell on Wednesday after a surprise repo rate cut by the South African Reserve Bank, while broader emerging market risk assets retreated amid continued focus on the coronavirus outbreak.

The following statement is on behalf of Peregrine Treasury Solutions:

By Bianca Botes, Executive Director at Peregrine Treasury Solutions

15 April 2020: The rand is falling prey to a risk-off environment due to the dire outlook for the South African economy and has lost a massive 2.5% today.

The situation has been exacerbated by US President Donald Trump’s withdrawal of funding from the World Health Organization (WHO) in the middle of a global pandemic.

The uncertainty regarding how long global lockdowns will endure is also adding fuel to the uncertainty in markets. On 13 April, for example, France extended its lockdown from 15 April to 11 May, on 14 April, India’s lockdown was extended to 3 May and there is widespread belief that the US will not be able to open its economy on 1 May, despite Trump’s claims that he can.

For more coverage on COVID-19 visit: https://www.cnbcafrica.com/covid-19/

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