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South Africa's rand plunges to all-time low

Published 03/30/2020, 08:15 PM
Updated 03/30/2020, 08:30 PM
USD/ZAR
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South Africa's rand plunged to an all-time low on Monday (March 30) - slipping below 18 to the dollar.

That's after ratings firm Moody's cut the country's investment grade credit rating to "junk" on Friday (March 27), heaping more pain on a country already in recession and looking down the barrel of steep economic contraction amid the global coronavirus pandemic.

Moody's was the last of the big three agencies to downgrade Africa's most industrialized economy to sub-investment grade.

It had left South Africa on the brink of junk in November when it revised its outlook to negative but in February a national budget showed a worsening of the fiscal picture.

Output is also now set to be dented as workers have been told to stay at home for 21 days to prevent the spread of the coronavirus.

South Africa has reported over 1,000 infections and confirmed its second death on Sunday (March 29).

The treasury has raised the prospect of approaching the International Monetary Fund for emergency cash to fight the country's outbreak - which is the largest on the continent.

But accessing funds from multilateral organisations has long been unpopular with the government, and on Sunday the finance minister said they would only seek such assistance as a last resort.

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