Local politics‚ possible Opec output cut weigh on the rand
The rand was weaker on Wednesday morning on concern about a possible Cabinet reshuffle after President Jacob Zuma survived an attempt to remove him.
The ANC national executive committee (NEC) announced on Tuesday that Zuma would continue as president. A number of NEC members had expressed their dissatisfaction with his leadership at a tense three-day meeting.
ANC secretary-general Gwede Mantashe has given assurances that there will be no reprisals for those who called for Zuma’s removal but insiders have said no agreement was reached at the NEC meeting that there would not be a Cabinet reshuffle.
Also expected to affect the rand is a meeting of the Organisation of the Petroleum Exporting Countries (Opec) in Vienna later in the day to hammer out an agreement on cutting production to boost oil prices.
Rand Merchant Bank analyst Celeste Fauconnier said the best outcome for the rand was for the meeting to collapse‚ which would send the oil price into the $40-a-barrel range.
Fauconnier said the worst-case scenario for the rand was for the oil price to shoot up past $50 per barrel‚ likely if members decide to cut production.
Markets’ focus is shifting to the US Federal Reserve policy meeting in December‚ where an interest rate increase is widely expected.
At 8.30am‚ the rand was at R13.9335 to the dollar from Tuesday’s R13.8784. It was at R14.8148 to the euro from R14.7827 and R17.3915 to the pound from R17.3423.
The euro was at $1.0633 from $1.0650.
– TMG Digital/BusinessLIVE