Rand, other emerging currencies recover from shock of Trump's tariff hike announcement
Trump has issued letters to more than a dozen countries, including South Africa, putting them on notice for an increase in import duties on goods bound for the US.
JOHANNESBURG - Some emerging currencies have recovered from the shock of tariff hikes by United States (US) President Donald Trump.
Trump has issued letters to more than a dozen countries, including South Africa, putting them on notice for an increase in import duties on goods bound for the US.
South Africa has been slapped with a 30% levy at the start of August.
At its weakest on Tuesday, the rand traded at R17.86 against the dollar.
It has since recovered slightly to R17.77 to the dollar.
The risk-sensitive rand had already battled at the start of the week when Trump threatened additional 10% tariffs for countries aligned with the BRICS bloc.
Trump described BRICS allies as having an anti-American agenda.
Despite the concerns about the impact on exports, especially for the agricultural industry, there is some optimism that South Africa can still negotiate favourable terms of trade with the US before the new tariffs take effect in three weeks’ time.
At the current rate, the rand is almost 10% stronger than it was in April when it traded at 19.74 to the dollar when Trump first announced the ‘Liberation Day’ tariffs.
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