The rand currency was recovering on Thursday, one day after its biggest fall for more than a decade sparked by fears of a global recession, economists said.
The rand nosedived by 18% against the dollar on Wednesday, hitting an overnight low 10,82 to the dollar, its biggest one-day loss since 1994.
The local unit recovered in morning trading on Thursday and was being quoted at about 10,08 to the dollar at midday in Johannesburg, still at the lowest level seen in two years.
Economists blamed the fall on a worsening global outlook that has seen commodities prices plunge. Gold and platinum are South Africa’s biggest exports.
“On a good note, the weaker rand is going to help boost the exports industry but locally it spells a gloomy outlook for inflation and interest rates, which are already putting pressure on growth,” said Azar Jammine, Econometrix chief economist.
He said the remarkable decline of the rand was an aftershock of the global economic turmoil that has roiled markets around the world.
The JSE all-share index was down 0,65% to 20 437,18. — AFP