South Africa\u2019s rand weakened the most in five months and benchmark bonds sold off as rolling power cuts, flood damage and signs of a Covid comeback added to worries about the country\u2019s economic outlook.<\/p>\n
As global concern over rising U.S. interest rates sent emerging-market currencies into reverse, the rand weakened more than 2% against the dollar on Tuesday, the biggest daily decline among the asset class.<\/p>\n
South Africa\u2019s state power utility warned the country may have more than 100 days of electricity blackouts this year because of outages.<\/p>\n
The government will ask parliament for additional funding of R1 billion to repair infrastructure damaged by deadly floods in KwaZulu Natal province.<\/p>\n
This hampers plans to reduce the budget deficit and curb government debt, a key factor preventing credit-rating upgrades.<\/p>\n
In addition, growing evidence of a\u00a0resurgence<\/a><\/strong>\u00a0of Covid \u201ccould complicate\u201d South Africa\u2019s economic recovery, said Brendan McKenna, an currency strategist at Wells Fargo Securities in New York.<\/p>\n The rand slumped as much as 2.4% to 15.0014 per dollar, the lowest in nearly a month, by 3:47 p.m. in New York.<\/p>\n The currency is headed for the biggest daily drop since November. Meantime, the yields on 2032 government bonds climbed 17 basis points to 10.28%.<\/p>\n \u201cThere were some pretty severe floods in South Africa recently that caused a fair amount of damage,\u201d McKenna said. \u201cLooks like the government is asking for funds to start rebuilding, which could add to the debt burden and fiscal deficit.\u201d<\/p>\n He said that public finances in the country were \u201calready in bad shape, so that could be weighing on the currency too.\u201d<\/p>\n Treasury yields surged Tuesday as inflation fueled by the war in Ukraine and supply-chain chaos bolstered expectations for tightening by the Federal Reserve, strengthening the dollar.<\/p>\n South Africa\u2019s rand weakened the most in five months and benchmark bonds sold off as rolling power cuts, flood damage and signs of a Covid comeback added to worries about the country\u2019s economic outlook.<\/p>\n","protected":false},"author":341034,"featured_media":441714,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_sma_x_autopost_status":"idle","_sma_x_autopost_error":"","_sma_x_post_id":"","_sma_facebook_post_id":"","_sma_instagram_post_id":"","_sma_threads_post_id":"","_sma_x_attempts":0,"footnotes":""},"categories":[19],"tags":[181,77886,8487,23359,23911],"class_list":["post-441708","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-eskom","tag-kzn-floods-2022","tag-load-shedding","tag-rand","tag-us-federal-reserve"],"_links":{"self":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/441708"}],"collection":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/users\/341034"}],"replies":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/comments?post=441708"}],"version-history":[{"count":0,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/441708\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media\/441714"}],"wp:attachment":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media?parent=441708"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/categories?post=441708"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/tags?post=441708"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Now read: KwaZulu-Natal floods South Africa\u2019s deadliest in decades<\/a><\/h3>\n","protected":false},"excerpt":{"rendered":"