JOHANNESBURG (Reuters) – South Africa’s rand weakened on volatile trading on Tuesday after comments from the two biggest parties in the unity government suggested a cabinet announcement from President Cyril Ramaphosa was getting closer.
The currency was about 0.3% weaker at 18.16 against the dollar at 1220 GMT, adding to losses a day earlier.
Financial markets are uncertain about what Ramaphosa’s new cabinet will look like, as it will provide a good indication of how the African National Congress party plans to share power with its biggest rival, the Democratic Alliance.
A total of ten political parties have joined the unity government after the ANC lost its parliamentary majority in elections last month for the first time since the end of apartheid thirty years ago.
Asked whether a cabinet announcement was imminent, a senior member of the prosecutor’s negotiating team, Helen Zille, told Reuters on Tuesday: “I think you should hear something within the next 24 hours.”
An ANC spokesperson said the party had given its communications team a timeframe of approximately 24 to 36 hours before the cabinet would be made public.
Ramaphosa’s spokesperson declined to comment on the timeframes given by the DA and ANC.
Local media, including news website News24, previously reported that negotiations between the ANC and the DA were progressing and that an agreement could be reached that would allow Ramaphosa to announce his presidency on Wednesday.
Analysts at Commerzbank (ETR:) said investors were focusing on the number of ministerial positions the pro-business DA would get.
“The more and the more senior, the better (for the markets),” they said in a research note.
On the Johannesburg Stock Exchange, the blue-chip Top-40 index was about 0.7% weaker. Benchmark government bonds for 2030 were stronger as yields fell 5 basis points to 9.805%.
