Rand weakens ahead of next week’s elections

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The rand has weakened slightly against the US dollar amid rising expectations that the outcome of next week’s election could affect markets.

The local unit started the week stronger at R18,07.

The local currency weakened to levels around R18,40 to the greenback earlier on Friday.

Economist Dawie Roodt says the rand appears to be undervalued.

“And I think the reason for that that what we saw the rent weakness the last couple of months had to do with the fact that there was a possibility that the election outcome could be well less favourable for the economy and for the financial markets. And I think the financial markets discounted the possibility of a coalition between the African National Congress (ANC) and Economic Freedom Fighters (EFF).”

Rand weakens ahead of next week’s elections