The South African rand fell during the current trading session but has bounced versus the US dollar by now. The drop was a result of the sovereign credit rating downgrade by Standard & Poor’s.
The S&P reduced South Africa’s credit grade to junk status today. The decision followed sacking of country’s Finance Minister Pravin Gordhan last Thursday. The rating downgrade is likely to erode investors’ confidence in the country’s assets and will make it more expensive for South Africa to borrow on international markets.
USD/ZAR dropped 0.66% to 13.5967 as of 18:28 GMT today.
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