By Samkele Mchunu
South African Rand Gains Amidst Unity Government Talks
Johannesburg – The South African rand strengthened on Tuesday (June 11th, 2024) as political parties continued negotiations to form a government of national unity. This comes just days before the first official session of the National Assembly.
By 3:50 PM GMT, the rand had gained 0.44% against the dollar, trading at 18.6450. This positive movement is likely due to increased investor confidence as a result of the ongoing unity government talks.
The African National Congress (ANC), which lost its parliamentary majority in the May elections for the first time since the end of apartheid, announced last week that they would seek a coalition government. Potential partners include the business-friendly Democratic Alliance and the left-wing Economic Freedom Fighters.
“The ongoing discussions will likely remain a key focus for investors leading up to Friday,” noted Rand Merchant Bank analysts in a research report. “This is when the National Assembly convenes for its first sitting.”
The upcoming session will see the swearing-in of new lawmakers, as well as the election of the speaker, deputy speaker, and the next president of South Africa.
While the rand gained traction, the Johannesburg Stock Exchange’s Top-40 index closed slightly lower, dipping 0.2%.
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