JOHANNESBURG: The rand was little changed early on Monday, as market participants appeared to shrug off the United States’ decision late last week to expel South Africa’s ambassador in yet another sign of the two countries’ rapidly souring relations.
At 0800 GMT, the rand traded at 18.2125 against the dollar , near its Friday close.
U.S.-South Africa ties have deteriorated since Donald Trump’s return to the White House in January.
U.S. Secretary of State Marco Rubio announced Ambassador Ebrahim Rasool’s expulsion in a post on X on Friday, citing an article in which Rasool was quoted as saying that Trump was leading a white supremacist movement.
South Africa called Rasool’s expulsion regrettable and said it was committed to building mutually beneficial relations.
Analysts, however, said interactions with the Trump administration were already tense before the latest spat and expressed confidence the two sides would mend ties due to the strategic value of their trade.
South African rand jumps as gold high boosts commodity-backed currency
South Africa supplies many critical minerals to the U.S. while it benefits from preferential access to U.S. markets under the U.S. African Growth and Opportunity Act.
“The U.S. still relies on SA’s key minerals (chrome, platinum, manganese, vanadium), which means a total breakdown is unlikely,” said Andre Cilliers, currency strategist at TreasuryONE. “Instead, the Trump administration is expected to favour bilateral negotiations for new trade terms.”
Later this week investors’ focus will shift to local inflation data due to be released on Wednesday and an interest rate decision on Thursday.
Negotiations between political parties over this year’s deadlocked budget could also move markets.
The Johannesburg Stock Exchange’s Top-40 index last traded up 0.3%. The benchmark 2030 government bond was slightly weaker, as the yield rose 2 basis points to 9.185%.
Comments