South African rand slips as budget speech fails to impress
Updates to afternoon trade, adds detail from budget in paragraph 3, analyst quote in paragraph 6
JOHANNESBURG, Oct 30 (Reuters) -The South African rand slipped onWednesday as akeenly awaited budget speech by the finance minister failed to impress investors.
At 1551 GMT, the rand traded at 17.6825 againstthe U.S. dollar ZAR=D3, down about 0.2% fromits previous close.
South Africa's government on Wednesdayforecast wider budget deficits and higher debt over the next three years even as growth prospects improved due to better electricity supply.
The mid-term budget was thefirst under a coalition government formed after the African National Congress party lost its majority.
The coalition government has committed to lifting economic growth and making progress with reforms, boosting investor confidence and fuellinga rally in the rand and local currency debt.
"The fiscal path set out in the MTBPS (medium-term budget policy statement) probably fell short of the market's relatively upbeat expectations," said Nedbank analysts in a research note.
Economists polled by Reuters hadpredicted Finance Minister Enoch Godongwana will announce a lower 2024/25 budget deficit estimate than in February's main budget.
In the stock market, the Top-40 .JTOPI index closed 0.61% lower.
South Africa's benchmark 2030 government bond ZAR2030= fell marginally, as the yield rose 1.5basis points to 9.285%.
Reporting by Alexander Winning and Bhargav Acharya; Editing by Savio D'Souza and Richard Chang
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
