/ 12 January 2003

Mugabe comments hurt rand

The South African rand lost ground against major currencies early on Tuesday afternoon after Zimbabwe President Robert Mugabe denied reports of a plan that would see him step down.

Early Tuesday afternoon, the rand was trading at R8,7340 to the dollar from a New York close of R8,6305. It traded at an intraday worst level of R8,75, the rand’s worst level since December 30, 2002.

On Monday, reports that top ruling party officials in Zimbabwe were offering a deal to end Mugabe’s rule in that country were denied by both the opposition MDC and the South African government.

Nevertheless, when Mugabe himself denied these reports, the rand started to weaken, a currency trader said.

“When Mugabe said something denying the reports, the rand started to move up (weaker),” he said, adding that London banks had also been buying dollars today.

At 1423, the rand was trading at R9,2154 against the euro from a previous R9,1302.

It broke above the R14,00 rand level against sterling to trade at R14,0115 from Monday’s R13,8991. – I-Net Bridge