A thumbs up for Zuma
PRESIDENT Jacob Zuma's State of the Nation Address for 2012 delivered on Thursday has been well received by business and organised labour.
Picture taken from www.drpinna.comAs soon as it was announced, traders pulled their prices
Zuma emphasised the need for a strong policy environment in order to achieve economic growth and employment, as set out in the New Growth Path and National Development Plan.
Zuma also emphasised economic factors, especially on the need to enhance South Africa's global competitiveness.
Business Unity South Africa (Busa) welcomed welcomes the new infrastructural plans identified in the Presidential Infrastructure Co-ordinating Com- mission and supports the decision to call a Presidential Summit of investors and social partners.
They are also pleased that regional projects were identified, as well as national, provincial and local government programmes, but says government must ensure speedy, efficient implementation of the planned programmes and projects.
Meanwhile, Cosatu says it welcomes the ambitious plans for infrastructure development of roads, rail, ports and water, and the beneficiation strategy that seeks to provide opportunities in the downstream part of the minerals sector.
Cosatu says if all these plans are fully implemented, they will play a major part in both creating jobs directly and laying the foundations for a modern, manufacturing-based economy.
The rand tumbled over 2% against the dollar on Friday after the central bank signalled there would be an important weekend announcement, sparking panic selling of the rand and spooking bond traders. The rand fell 2,6% against the dollar to a nine-day low of 7,7803, off a close of 7,5845 in New York on Thursday.
But it firmed back to 7,7390 in later trade as the market was calmed by talk that the central bank announcement would not be alarming.
The announcement yesterday was that former President Nelson Mandela's face would feature on ZAR banknotes.
The local unit had taken a weaker tone for most of the day as a Greece bailout deal was further delayed, prompting investors to dump risky assets.
It extended losses sharply after the central bank signalled a Saturday announcement of "national importance."
"As soon as it was announced, traders pulled their prices," said Richard Farber of WWC Securities.
"Once the rumours started to fly about the central bank we saw some panic buying, offshore banks especially were nervous about that, buying dollars," a local currency dealer said.
Most bond traders stopped dealing. Yields ended little changed from Thursday's close as the market thinned and dealers tried to position for yesterday's announcement.
The yield on the 2015 bond ended up 2 basis points at 6,64% and the 2026 issue was up 2,5 basis points at 8,31%.
However, the local Business Day newspaper, in an online article, later quoted a member of the central bank's Monetary Policy Committee saying "there will be no resignation and no monetary policy implications. It's not a bad news story; it's a good news story". - Additional reporting by Reuters
