Johannesburg – The South African rand’s flow only lasted as long as Cyril Ramaphosa’s rise to the top, of the ruling party.
Now that he won the presidential race, the currency’s “world-beating rally is losing steam, and derivatives markets suggest it’s vulnerable to a renewed selloff”.
The rand was 14% against the dollar, since it became low on the 13th of November, after investors place a bet saying that if Ramaphosa won the elections against his rival Nkosazana Dlamini-Zuma, and become the ruling party’s leader and become the next president in 2019.
On Tuesday when country’s stock and local bonds rose. Then on Wednesday when Ramaphosa won the presidential race elections gains on stock and bonds were extended.
According to Guillaume Tresca, an emerging market strategist at Credit Agricole CIB in Paris, “the market has got ahead of itself as the victory of Ramaphosa does not spell the end of South Africa’s issues,” Tresca also went on to say “It’s facing a turbulent period in the near future, which will make its assets vulnerable. Moreover, the medium- to long-term outlook is still not positive for the rand.”