Rand loses 1% against US dollar

The rand has lost more than 1% against the US dollar n Monday morning, following unconfirmed media reports of the resignation of budget office head, Michael Sachs.

Market analyst Liston Meintjies says the latest development is a huge blow to National Treasury and the country.

The local currency has been trading at R14.50, its weakest level in a year against a basket of major currencies. This comes amidst raising fears of a ratings downgrade to sub-investment grade in the near future, as well as political and economic uncertainty.

According to Meintjes, South Africa can no longer avert a credit downgrade.

“It does not surprise. It is part of the on-going problem. The problem will remain there, whether or not he has resigned. There can be short-term measures which will sort of help. We shouldn’t be debating whether we will get a downgrade, but what we are going to about it”