The South African rand strengthened on Tuesday, supported by gold’s continued surge to a new all-time high. As of 0814 GMT, the rand traded at 18.0175 per dollar, marking a 0.4% gain from its previous close.
Gold reached a record $3,018.66 per ounce, extending its rally as investors sought refuge from market volatility fueled by U.S. President Donald Trump’s tariff war.
As one of the world’s leading producers of precious metals, South Africa could see increased mining activity due to the soaring gold price.
“At some point a gold price that continues to rise will excite local miners to make a greater effort to mine difficult-to-reach gold deposits. What may not have looked viable several years ago must be looking interesting now,” ETM Analytics noted in a research report.
Despite domestic and global uncertainty, the rand has shown resilience.
South Africa’s national budget remains deadlocked for the first time since the end of apartheid due to disagreements within the ruling coalition. Meanwhile, diplomatic ties with the U.S. have deteriorated sharply since Trump’s return to the White House in January, with the U.S. president cutting aid to South Africa. Analysts warn that the country’s preferential trade status under the U.S. African Growth and Opportunity Act (AGOA) may also be at risk.
On the economic front, investors are watching Wednesday’s inflation data and Thursday’s monetary policy announcement. A Reuters poll suggests the South African Reserve Bank may pause its rate-cutting cycle in response to heightened risks.
The Johannesburg Stock Exchange’s Top-40 index (.JTOPI) was last up about 1%, while the yield on South Africa’s benchmark 2030 government bond held steady at 9.17%.
