The South African rand is no longer at the mercy of hot money flowing in and out of the country at the whim of short-term investors, Business Report said on Tuesday.
It said global investors had started taking a long-term view of the country’s prospects.
”Where South Africa was once a day trader’s playground, it is now attracting ‘real money’ funds,” said Standard Bank group economist Goolam Ballim.
”They are investors who make a thorough assessment of the economy and, if it is favourable, they are in for the long term,” Ballim said.
The way in which long-term investors allocated funds was changing. Traditionally, they would put their funds into direct investment.
”The depth and liquidity of our financial markets is encouraging them to invest instead in a range of assets through financial instruments.”
Whatever the form of the investment, it was keeping the rand relatively stable, said the paper. – Sapa