On South Africa's Rand

South Africa's currency, the Rand, has seen a sharp sell off recently due to reports that the finance minister of South Africa has been notified to appear before the Hawks to face charges. We present the following two charts of the South Africa Rand: first, the Rand from December 2015 when President Zuma removed Finance Minister Nene; and second, the reaction of the Rand to the current news.

Back in December, the Rand fell over 9% across two days before Zuma was forced to appoint Gordhan as the Finance Minister to stem the slide, and the Rand then recovered in the next 2 days to just 2.7% down.

The current sell off in the Rand has not yet reached a similar bottom as compared to the December chart, and it can be expected to get worse if President Zuma does not change course. However, President Zuma would face the same pressures, if not more, as in December and a quick recovery is still possible if Finance Minister Gordhan's situation is resolved amicably.

Nile Capital Management

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