Close-up of a Five Rand coin resting on a new South African Hundred Rand banknote, featuring the smiling face of iconic statesman Nelson Mandela.
The rand held firm despite President Cyril Ramaphosa’s decision to sign the controversial National Health Insurance (NHI) bill into law on Wednesday.
The currency traded little changed at R18.35/$ in late afternoon trade shortly after Ramaphosa officially ushered in the NHI at a signing ceremony at the Union Buildings in Pretoria. News that the NHI would be signed into law just two weeks before the 29 May general election, in which the ANC is expected to lose its majority for the first time, had been met with a mix of consternation and threats of legal action from business lobby groups and private sector medical insurance firms.
Adam Furlan, a fixed-income portfolio manager at Ninety One, told News24 the rand’s resilience in the face of the NHI bill was likely due to a combination of factors, including benign US inflation data that bolstered the chance of rate cuts, and South Africa’s improving terms of trade. He also said the fact that risks associated with the NHI were well known and likely to be challenged in court were supportive of the rand.
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