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The South African rand showed signs of recovery, making modest gains after experiencing losses in the previous session. The currency’s rebound came as attention moved away from the unexpected delay in the national budget presentation to the upcoming G20 foreign ministers’ meeting scheduled to take place in Johannesburg later in the day.
The rand was trading at 18.4925 against the dollar, marking a slight improvement of 0.2% from its last close. The adjustment followed a dip on Wednesday when the currency reacted to the postponement of the budget announcement.
The delay was a result of a disagreement within South Africa’s coalition government over a proposed increase in the value-added tax (VAT).
President Cyril Ramaphosa has reassured that the cabinet is collaborating to present a revised budget, now set for March 12. The postponement comes at a time when South Africa holds the presidency of the G20 and is preparing to host the group’s finance ministers and central bank governors next week in Cape Town.
Amid these developments, South Africa’s benchmark 2030 government bond also saw a slight increase in strength, with the yield falling 1.5 basis points to 9.165%.
The nation is currently in the global spotlight due to its G20 presidency and is facing international tensions, notably with the U.S. over its land redistribution policy and the genocide case against Israel at the World Court.
The G20 foreign ministers’ meeting in Johannesburg is being closely watched, as it could influence the rand’s performance and South Africa’s economic diplomacy on the global stage.
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