Weakening rand to affect imports

The Rand recently dropped to a 14-year low against the US dollar trading at over R13. 

FNB's Alex Smith says the weakness is not specific to South Africa. He says most emerging market economies have been under severe pressure in recent months. 

Smith highlighted Turkey, Russia and Brazil as countries that have all suffered under the current conditions. Smith says for the business sector stability is more important than the level of the currency. 

However, he says a weaker rand isn't always bad new for everyone.

''It's also worth mentioning that there are always winners and losers when the currency moves like this, for example the mining sector will probably be quite glad to see the currency weakened because they sell their commodities at a 6-dollar price so they're getting more rands for their commodities when the rand weakens. 

''But obviously for sectors which import a lot of goods - it has increased costs quite dramatically,'' he said.

(File photo: Gallo Images)