Rand Plummets to New Lows, the Euro Takes a Blow as US Dollar Strengthens, Global Recession Fears Grow

Rand Plummets to New Lows, the Euro Takes a Blow as US Dollar Strengthens, Global Recession Fears Grow

  • The South African rand continues to weaken and is trading at R17,04 to the United States of America's dollar
  • The rand's value decreased as international investors look to the safety of the US dollar due to fears of a global recession
  • A market analyst said that the economic situation further stokes recession fears in the bloc

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JOHANNESBURG - Adding to the list of growing problems that South Africans face, the rand continues to weaken and is trading at R17,04 to the dollar. The dollar strengthens to be at par with the euro for the first time in 20 years.

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The rand continues to weaken amid fears of a global recession. Image: Stock image
Source: Getty Images

The rand and other emerging currencies’ value have decreased as international investors look to the safety of the US dollar due to fears of a global recession. According to SABC News, the British pound has recently weakened due to the country’s leadership change.

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The Russian war in Ukraine has hampered the European region’s economies, causing the euro to plummet 12% lower than the US dollar.

The Chief Market Analyst at Markets.com, Neil Wilson, told The Guardian that the euro neared parity with the dollar for the first time since 2002. He added that the economic situation further stokes recession fears in the bloc, and the currency cannot catch a bid.

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South Africans react to the weakened rand:

@NtshidiGilbert said:

“We were told that, if Ramaphosa doesn’t become the president, the rand will be weak. Now he’s sitting president. The rand becomes weaker. What went wrong?”

@TumishiN commented:

“ANC economic policies are disastrous, we use our own currency but we have similar problems experienced by Zimbabwe that is using a dollar.”

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@mkhululidubegm1 posted:

“The man in charge is still not being questioned.”

@RestoreMthwakaz added:

“It’s all because of the Phala Phala farm gate.”

Zimbabwe plans to sell 22-carat gold coins to assist struggling economy, after losing dollar value

In a related matter, Briefly News also reported Zimbabwe will start selling gold coins to ease the country’s crumbling economy and inflation. The central bank said the coins would be available on sale from Monday, 25 July, in local currency, US dollars and other foreign currencies.

Governor John Mangudya said the Mosi-oa-tunya coin, which is named after the Victoria Falls, can be converted into cash.

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Source: Briefly News

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