Thursday, 21st February 2008 at 11:09 am by Rander
Rand reaches five-year lows

therandtoday73.jpgThe Rand reached a five-year low yesterday (20 February) when it was trading at R7.87 against the US dollar. This occurred just after the Minister of Finance announced the country’s budget. The drop in the rand is largely due to the announcement in the budget that exchange controls in the country had been eased meaning that quite a lot of money would be able to flow out of the country.

The government said it would ease exchange controls, allowing institutional investors to invest more offshore and removing a requirement that they obtain permission before taking the cash out of the country. With the current sentiment over South Africa, it could mean that investors maybe looking to invest their money offshore due to the negative outlook being caused by the ever rising inflation, electricity shortages and political leadership in South Africa. Billions of rand could flow out of the country which could also then force interest rates to go up again.

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Comments

Jennifer Lancey on 21 February, 2008 at 11:43 am #

I found your site on technorati and read a few of your other posts. Keep up the good work. I just added your RSS feed to my Google News Reader. Looking forward to reading more from you.

Jennifer Lancey


Allen Taylor on 21 February, 2008 at 12:01 pm #

I found your site on technorati and read a few of your other posts. Keep up the good work. I just added your RSS feed to my Google News Reader. Looking forward to reading more from you.

Allen Taylor


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