MARIAM ISA, Johannesburg | Friday 5.15pm.
THE battered rand could test fresh lows against the dollar as the turmoil in neighbouring Zimbabwe escalates, with the euro’s slide dealing another blow to waning confidence, analysts said on Friday.
Few held out much hope of a recovery for the currency near-term, which sank to R6,86 to the dollar on Thursday under the weight of an offshore attack sparked by foreign concern that Zimbabwe’s land crisis could spread.
Buying by domestic exporters on Friday when local markets re-opened after Thursday’s national holiday failed to provide much of a boost for the rand, which has now lost 12% of its value against the dollar this year.
Traders warned that the currency may sink to R6,90 soon if Zimbabwe police do not keep their pledge to crack down on political violence in their country, where veterans of the 1970s independence war have occupied hundreds of white-owned farms.
”In the coming weeks, if Zimbabwe stabilises the rand will retrace some of its steps — but I wouldn’t be too optimistic about an appreciation,” BOE Securities economist Herman van Papendorp said.
”What we have seen lately is a bit of an over-reaction to the Zimbabwe story but every time when there is a blow against the rand it doesn’t come back to previous levels,” he said. — Reuters