South African rand gains as cabinet announcement wait drags on
2024.06.28 03:43
JOHANNESBURG (Reuters) – The South African rand clawed back some losses in early trade on Friday, as the wait for the announcement of President Cyril Ramaphosa’s unity government cabinet drags on.
At 0700 GMT, the rand traded at 18.4150 against the dollar, more than 0.3% stronger than its previous close.
The rand fell sharply on Thursday after media reports of a major disagreement between the pro-business Democratic Alliance (DA) party and Ramaphosa of the African National Congress (ANC) over cabinet posts.
The DA agreed to join the ANC and eight other parties in a government of national unity (GNU) after the ANC lost its parliamentary majority in an election last month.
“The impasse in negotiations between the ANC and DA and the possibility of a GNU which excludes the DA has put the rand under considerable pressure,” said Andre Cilliers, currency strategist at TreasuryONE.
Financial markets are eagerly awaiting the composition of the cabinet, which will indicate whether the ANC intends to share power meaningfully with its GNU partners.
The ANC and DA officials told Reuters earlier this week that the announcement was expected on Wednesday or Thursday. However, there is still no confirmation of when the cabinet will be announced.
South Africa’s benchmark 2030 government bond was little changed in early deals, with the yield down 1 basis point to 10.115%.
