Load shedding weakens rand by a percentage

Load shedding weakens rand by a percentage

Eskom's load shedding announcement caused the Rand to weaken by 1 per cent. 

Minister Kgosienstho Ramokgopa
GCIS

An economist says investor confidence dipped when news broke on Friday that stage 3 of the rolling blackouts would resume after 10 months. 


Eskom says it is working to replenish reserves after multiple trips at two power stations. 


Harry Scherzer, who is with Future Forex, says the Rand has been benefiting from the stable supply of power.

"Markets tend to react swiftly to uncertainty and given Eskom's central role in South Africa's economy any sign of back-siding empower stability triggers risk-off sentiment. Investors are particularly wary of the structural issues resurfacing - fearing this could impact growth forecasts and on the rands outlook. Well Eskom frames this as a temporary setback, markets will be watching closely how quickly emergency reserves are replenished."       


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