SA rand under pressure with Marcus departure
The rand has reached fresh 7-month low alongside news of Gill Marcus’s departure from the SA Reserve Bank.
JOHANNESBURG - South Africa's rand visited a fresh 7-month low on Friday, in a market still coming to terms with the news that well-regarded central bank Governor Gill Marcus will leave her post in November.
Traders said uncertainty over who will succeed Marcus would keep investors nervous about future monetary policy in Africa's most advanced economy.
The rand's moves also reflected a stronger dollar as investors anticipate that the US Federal Reserve might tighten policy faster than expected.
A fairly dovish domestic policy statement this week, in which the Reserve Bank further cut its GDP growth forecast for 2014 has also dented prospects for South African rates rising higher this year.
The rand hit a session trough of 11.1150 to the greenback on Friday and was trading at 11.0980 by 1616 GMT, a 0.21 percent retreat from Thursday's close.
Friday's losses added to rand weakness overnight after Marcus announced that she would not be extending her contract when her current five year term as governor ends in November.
Government bonds however recouped some of the previous day's losses, with the yield on the benchmark 2026 government bond shedding 3 basis points to close at 8.21 percent.