Johannesburg - The rand fell nearly 1.5% against the dollar on Tuesday to its weakest level in nearly nine weeks, becoming the worst performer on the day of emerging market currencies tracked by Reuters.
The rand was trading at R8.445/$ in late afternoon trade, 1.3% weaker than Monday’s New York close of R8.3369/$. It hit R8.455/$ earlier, its weakest since September 22.
Government bonds followed suit, with the yields rising to multi-week highs. The 2015 bond yield went up 11 basis points to 6.94%, and that on the 2026 issue climbing 15 basis points to 8.675%.
A senior trader said: "The rand has been weak the whole day; the market sell-off seemed to accelerate when that vote went through parliament. There was also some negativity coming out of India which has undermined Brics."
However, another dealer refuted that rand weakness in the afternoon session was solely as a result of the controversial protection of state information bill.
"People are suggesting this, but the rand had already started to weaken before the meeting, and the result was hardly going to surprise." He acknowledged however, that the bill wouldn't help the rand.
The National Assembly on Tuesday approved the controversial protection of state information bill, despite widespread opposition and question marks around its constitutionality.