South African rand appreciates as the president pledges changes

President Cyril Ramaphosa said Friday that his administration will implement a second round of changes in an effort to accelerate economic development, which caused the rand to strengthen.

The rand was up 0.3% from its previous closing at 18.37 vs the US dollar at 1531 GMT. Since last Friday, when it closed, the rand has increased by almost 1.8%.

During Thursday’s annual State of the Nation Address (SONA), Ramaphosa pledged to implement changes that would raise South Africa’s growth rate beyond 3% by investing in infrastructure and supporting faltering state enterprises like power utility Eskom and logistics company Transnet.

One thing that the SONA failed to achieve was to undermine the ZAR. In contrast, ETM Analytics stated in a research note that the ZAR has had a very successful week.

“It may have started the week on the defensive but appears to be ending it firmly on the front foot (and) now looks set to target levels closer to 18.4000 ahead of the weekend,” the note stated.

Monday saw a decline in the value of the rand, but it recovered when U.S. President Donald Trump threatened to stop financing South Africa for allegedly stealing land without providing proof.

On Thursday, Ramaphosa declared that his nation “will not be bullied”.

The Top-40 stock market index (.JTOPI) opened a new tab index and closed around 0.5% higher.

The benchmark South African government bond for 2030 had a lower yield, rising 1.5 basis points to 9.065%.