South Africa’s Rand Continues to Tumble on Reserve Bank Worries

South Africa’s rand fell again early on Friday, reaching a new 2019 low as assurances by the African National Congress (ANC) about the independence of the Reserve Bank did little to ease nerves about economic policy.

A street money changer counts South African Rands in Harare, Zimbabwe, May 5, 2016. REUTERS/Philimon Bulawayo

At 0640 GMT, the rand was 0.63% weaker at 15.0900 per dollar, bringing losses since Monday to nearly 5% as a public spat among senior ANC officials over the Reserve Bank’s mandate added to the bad news of a contraction to the economy.

The row has exposed deep divisions within the ANC. A group loyal to President Cyril Ramaphosa opposes calls from a rival faction for the bank to do more to boost employment and kick-start growth in the country’s ailing economy.

Data on Tuesday showed first-quarter growth contracted 3.2%, the most in a decade, almost immediately followed by the ANC’s announcement that it wanted the bank to consider quantitative easing to lower government debts, sending the rand crashing.

A U.S. jobs report due later is expected to support the case for an interest rate cut by the Federal Reserve. Emerging- market currencies would benefit as yield-hunting investors looked for higher returns.

Bonds were also weaker, with the yield on the 10-year government bond at 8.535%.

(Reporting by Mfuneko Toyana, editing by Larry King)