Johannesburg - The rand extended its decline at noon on Tuesday due to fears of forced Eskom Holdings power blackouts‚ that could have a negative affect on local mining and manufacturing output.
Electricity capacity is low and its margin between available capacity and peak demand was only 1.5%‚ Eskom said late on Monday.
This comes after strikes at coal producer Exxaro Resources which could affect coal supplies to Eskom plants to generate electricity.
“The rand so far today reached its weakest level of R9.24/$‚ after it traded firmer on Monday against its peers after the Cyprus bail-out news hit home. However the rand retraced its outperformance of yesterday and is now trading lower than its other merging markets peers‚” a local trader said.
“Talks around Eskom doing load shedding that would hurt supply to mines also put pressure on the local currency. The fundamentals for the rand remains bearish and traders are positioning themselves ahead of tomorrow’s CPI and Reserve Bank Monetary Policy Committee announcements‚” he said.
At 11:55 the rand was bid at R9.2184/$ from R9.1640/$ at Monday’s close and R9.1684/$ at Friday’s close.
The local currency was bid at R11.9199/€ from its previous close of R11.8644/€ and at R13.9206 against sterling from R13.8377 before.
The euro was bid at $1.2937 from $1.2943 at Monday’s close and $1.2891 at Friday’s close.
Electricity capacity is low and its margin between available capacity and peak demand was only 1.5%‚ Eskom said late on Monday.
This comes after strikes at coal producer Exxaro Resources which could affect coal supplies to Eskom plants to generate electricity.
“The rand so far today reached its weakest level of R9.24/$‚ after it traded firmer on Monday against its peers after the Cyprus bail-out news hit home. However the rand retraced its outperformance of yesterday and is now trading lower than its other merging markets peers‚” a local trader said.
“Talks around Eskom doing load shedding that would hurt supply to mines also put pressure on the local currency. The fundamentals for the rand remains bearish and traders are positioning themselves ahead of tomorrow’s CPI and Reserve Bank Monetary Policy Committee announcements‚” he said.
At 11:55 the rand was bid at R9.2184/$ from R9.1640/$ at Monday’s close and R9.1684/$ at Friday’s close.
The local currency was bid at R11.9199/€ from its previous close of R11.8644/€ and at R13.9206 against sterling from R13.8377 before.
The euro was bid at $1.2937 from $1.2943 at Monday’s close and $1.2891 at Friday’s close.