Tuesday, October 11, 2016

Rand Hits Worst Level Since Mid-September on Gordhan Summons
Business Day Live
OCTOBER 11 2016, 17:04

The rand was at its weakest level to the dollar in nearly a month after Finance Minister Pravin Gordhan was summonsed to appear in court relating to alleged fraud.

The local currency had slipped more than 3% to the dollar by Tuesday afternoon. Gordhan will appear in court on November 2.

Business Unity SA’s president Jabu Mabuza said that it was "most unfortunate" that this development had happened so soon after Gordhan’s return from New York and Washington DC, where he led a delegation in an attempt to ensure the country avoided a sovereign credit downgrade later this year.

Mabuza said that while nobody was above the law, there was concern about the "emergence of a pattern" in which serious allegations were made against Gordhan close to important dates and developments.

Gordhan is set to present the medium-term budget policy statement in the National Assembly on the October 26.

TreasuryOne currency dealer Andre Botha said the timing of this announcement by the National Prosecuting Authority (NPA) was "rather strange", as it had said just last week that there was no case against Gordhan.

Botha said that in the long run, this would cause the "ears of the rating agencies to prick up", and SA would have negated all the good work done over the past few months.

At 3.32pm the rand was at R14.2463 to the dollar from Monday’s R13.8116. It earlier reached a worst level of R14.3330.

It was at R15.8002 to the euro from R15.3829 and R17.5349 to the pound from R17.0718.

The euro was at $1.0991 from $1.1139 previously.

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