Johannesburg | Tuesday
THE embattled South African rand powered to its best levels in three months against the dollar as exporters and overseas investors re-enter the market in anticipation of further gains, a report said on Tuesday.
The move coincided with the start of public hearings by a commission appointed by President Thabo Mbeki to probe the currency’s rapid depreciation last year, Johannesburg-based Business Day said.
The currency was trading at 10,94 to the dollar, 15,57 to the pound and 9,52 to the euro early Tuesday after hitting a best level of 10,84 to the US currency late on Monday.
This was the lowest the rand had dipped to the dollar since mid-December and four percent firmer to its close of 11,25 to the dollar the previous day.
Absa financial economist Matthys Strauss said exporters entered the market on Monday with the launch of the Myburgh Commission’s public hearings of evidence concerning the rand’s fall, offloading dollars in anticipation of a stronger local currency.
But Strauss told the news paper he did not believe that a rally below the 11-rand mark was sustainable unless there were further good news on privatisation and foreign direct investment into the country.
The commission, headed by lawyer John Myburgh, has been asked to probe whether any person or institution acted illegally or unethically in 2001 and contributed to the rand’s rapid depreciation.
In December, the rand hit a new record low against the dollar, when it traded at more than R13 to the US currency after starting 2001 at 7,58. – AFP