The rand showed little movement on Tuesday as markets anticipated Wednesday’s national budget, with analysts expecting Finance Minister Enoch Godongwana to maintain a course of fiscal consolidation.
The rand was trading at 16.0250 against the dollar, just slightly off Monday’s closing rate of 16.0275. Godongwana’s budget speech is anticipated to provide clarity on the ruling coalition’s fiscal priorities, approaches to managing national debt, and proposed economic reforms.
“I cannot get too excited about the budget, as the finance minister has been vocal that continued fiscal consolidation is going to happen. It may be that operators will like that and support the ZAR accordingly, although the moves should be small,” remarked treasury specialists.
Analysts have noted that the macroeconomic environment is relatively favourable and expect this year’s budget statement to indicate further progress in fiscal consolidation, with a quicker pace of deficit reduction, an expanding primary surplus, and stabilising public debt.
A strong fiscal update could bolster the local currency and help it remain around the 16.00 rand per dollar mark or even stronger, according to analysts.
“However, any disappointment or renewed global risk aversion linked to trade tensions could see the rand give back some of its recent gains,” they warned.
On Tuesday, traders focused on the South African Reserve Bank’s composite leading business cycle indicator for December, which showed a month-on-month decline of 1.0%.
This week also includes several economic indicators, such as producer price inflation data on Thursday, as well as money supply, private sector credit, trade balance, and budget balance figures on Friday.
On the Johannesburg Stock Exchange, the Top-40 index was last recorded down 0.4%.
As of Tuesday, 24 February, the rand is trading at R15.93 to the dollar, R21.53 to the pound, and R18.79 to the euro.
Gold is currently valued at $5,203.85 per ounce, while oil prices have risen to $71.26 per barrel.
5 important things happening in South Africa today
Eskom’s new tariff surge: Eskom’s upcoming tariff adjustments will raise fixed charges, impacting low-usage customers like small households and rooftop solar users. The National Energy Regulator of South Africa (Nersa) approved an average 8.76% increase for Eskom Direct customers, effective April 1, 2026. However, some customers, such as low-income households and heavy industrial users, benefit from preferential tariffs. As a result, many residential users may see their bills rise by more than 8.76%. [MyBroadband]
R8 billion cut from South Africa’s roads agency: The budget for the South African National Roads Agency (Sanral) has been reduced by approximately R8 billion for the current financial year. On Tuesday, Sanral board chair Themba Mhambi confirmed that the agency is considering a proposal for “special toll roads,” specifically designed for heavy freight that may cause significant damage to the road network. [Moneyweb]
Trouble ablaze at Cape Town’s airport: Cape Town International Airport, a key hub for South Africa’s tourism and business, faced significant disruptions on Tuesday after a fire broke out at 11h15. The incident, for which the cause is still unknown, damaged critical IT systems, diverting international flights and stranding many travellers. By 19h00, over 4,000 people were still in long check-in lines as the airport switched to manual processing. [BusinessDay]
Liquidated South African airline sold: After SA Express, a South African domestic airline, was liquidated in 2022, the liquidators are close to completing the process. They are now waiting for the sale of its name and brand, which is valued at R150,000. The South Gauteng High Court issued a final liquidation order for SA Express in September 2022, over two years after it was first placed into provisional liquidation on 28 April 2020. [BusinessTech]
R100 million fraud in Education Department: The Hawks have arrested 27 suspects, including senior government officials, in connection with a R100-million fraud case within the Mpumalanga Education Department. The group comprises nine government officials, 14 service providers, and four other individuals who face charges of fraud, corruption, and money laundering. Investigators allege that the accused profited from inflated contracts and received payments for substandard work. In some instances, the promised services were never delivered. The suspects are scheduled to appear in the Nelspruit magistrate’s court on Monday. [ENCA]
