The rand hits a new three year low due to the energy crisis
The South African rand struck a new three-year low today under renewed selling pressure from the worst power cuts on record. According to experts it could get worse in the coming months.
Investor sentiment towards the rand has soured this week, pushing the currency to its lowest level against the dollar since May of 2020.
The rand is down nearly 3% this week against the greenback, underperforming emerging market peers. At 08h30 this morning the rand was trading at R18.94 to the U.S. dollar, about 0.4% weaker than yesterday’s close.
The biggest factor contributing to the rand's fragile state is load shedding, with its weakness expected to continue in the short term.
President Cyril Ramaphosa is expected to answer questions from lawmakers on his government's efforts to ease the crippling power shortage at 12 today.
As it stands, Eskom is implementing power cuts lasting more than ten hours a day.
Done by: Thaakiera Ackerdien