Image credit: Pixabay
Image credit: Pixabay
The rand value has had a pretty memorable week, all things considered. It’s gradual gains against the dollar have been complimented by Friday’s stimulus package announcement, which looks to boost SA’s ailing economy.
After sliding into a recession and seeing the fule price soar, Cyril Ramaphosa was under pressure to deliver a plan that would restore a little more confidence within the country.
What was in the stimulus package?
South Africa’s economic downturn has had a negative impact on the currency and global investor confidence, with the rand dropping to its lowest point in over two years. Unfortunately, the hopes and promises around astute businessman Ramaphosa taking the reins have dwindled to pessimism.
On Friday, the president announced that there would be a relaxation of visa requirements for entry to South Africa, as part of a bid to encourage more foreigners to visit Mzansi. Tourism is a pillar of the economy, and Cyril is looking to hit the sweet spot on this one.
A review of the much-maligned mining charter, as well as one for electricity and port tariffs, were also being considered. Ramaphosa said that more funding will be allocated to township economies and that sanitation facilities at schools would also be prioritised.
Dollar to rand value, Friday 21 September
His suggestions seemed to keep the rand very happy. Ramaphosa began speaking at 10:30, when the rand value was $1 : R14.31. By the time he’d finished, it was dipping below the R14.20 mark, making a 1% gain against the greenback:
#StimulusPackage Follwing the presentation of the stimulus package by President Cyril Ramaphosa, the Rand has strengthened by 1% @FaizelPatel143
— iFaizel (@FaizelPatel143) September 21, 2018
Significantly, the rand is also back under the R19 mark against the British pound. By the conclusion of Ramaphosa’s address, the currency had strengthened by a similar amount to the dollar, coming in at R18.80 to its UK counterpart.
This caps off an impressive week for the rand, which has made gains of almost 5% against the USD. A low-volatility week in South Africa met with a tumultuous one in the States helped our currency make gains.
