Guiding consumers since 2009

Gordhan: Rand is too strong

By Staff Writer
Finance Minister Pravin Gordhan thinks the Rand is too strong and said that South Africa shares its concern with other emerging markets.

"The rand is too strong given the South African context, and we share the concerns of other emerging markets," he told reporters ahead of meetings of global finance chiefs at the International Monetary Fund and World Bank this weekend.

South Africa exited the recession during the third quarter of 2009 already but the country is still struggling with high unemployment and the economic recovery has been sluggish.

The Rand has, however, gained more than 28% against the US Dollar since the beginning of 2009 and more than seven percent since the start of 2010.
Low interest rates in advanced economies have caused investors to search for better returns in fast-growing emerging economies and the flow of capital is pushing up asset prices and inflation.

When Gordhan was asked whether the Reserve Bank should be accumulating foreign currency reserves more aggressively in the face of the strong Rand, Gordhan said: "More means you have got to find more resources; nothing comes for free in this business. We're working on that with the Reserve Bank."
Although the Rand weakened on Thursday, it's expected that the currency will be resuming its upward path on strong capital inflows.

Recent Articles

Featured What’s the deal with underwriting?

When you apply for a long-term insurance policy, a financial adviser will ask some personal questions about your lifestyle, family history, health, and even ask you to take some medical tests. This process is called underwriting, but is it really necessary?

 

How are you taxed on your retrenchment package?

Unemployment is one of the biggest problems in South Africa. The emergence of the Covid-19 pandemic has exacerbated the situation with a lot of companies retrenching their employees.  When retrenched, you’ll receive a retrenchment package, but do you know how much tax you’re liable for?

Car repossessed – don’t be taken for a ride

When the country is facing an economic downturn, chances are your finances will feel the pinch. This can lead you to make bad financial decisions such as skipping your vehicle payments. But every decision has consequences and if you don’t pay your instalment, the bank will repossess your car. But what can you do when this happens?

 

Why you should consider gap cover

Your medical aid should protect you from incurring large medical bills when you’re sick. But what if your plan doesn’t cover the full cost of your medical expenses? We got in touch with insurance experts to find out whether gap cover is worth having.

Deals

Office furniture at discounted prices at BDK

Price: Available on request
When: Daily
Where: Johannesburg

Da Vincis Happy Hour Special

Price: Available on request
When: Daily
Where: Cape Town

Use your Absa card and get 30% cashback at Dis-chem

Price: Available on request
When: Daily
Where: Nationwide


Latest Guide

Guide to debt rehabilitation solutions