JOHANNESBURG (Reuters) – The South African rand fell on Thursday as investors turned cautious ahead of recently re-elected President Cyril Ramaphosa’s cabinet appointments as part of his government of national unity.
At 1521 GMT, the rand was trading at 18.0625 against the US dollar, about 0.6% lower than its previous close. Earlier in the day, the rand weakened more than 1% against the dollar.
“Today’s depreciation could indicate some profit-taking in the rand as markets remain cautious ahead of recently re-elected President Cyril Ramaphosa’s cabinet appointments,” Shaun Murison, senior market analyst at IG, told Reuters.
The rand’s long-term performance appears to be heading for further growth, he said.
The local currency strengthened to a near 11-month high of 17.9200 on Wednesday after five political parties joined the African National Congress last week in forming a government of national unity after it lost its overall majority in the general election.
The dollar also strengthened on Thursday against a basket of currencies, “so the rand’s weakness is partly due to macro factors rather than purely local factors,” Murison said.
On the stock market, the Top 40 index closed down 0.72%.
South African government bonds due 2030 were weaker, with yields rising 4 basis points to 9.785%.