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The rand took the 2021 budget speech in stride on Wednesday, registering only a slight movement when Finance Minister Tito Mboweni delivered unexpected tax relief announcements in the face of the raging Covid-19 pandemic that has further slowed economic growth. .
The rand had started at R14.54 against the dollar and reached R14.49 shortly after Mboweni presented a budget reflecting the current pandemic-induced austerity.
The rand was flat throughout the speech, having gained roughly 0.9% against the dollar in intraday trading, as noted by Bianca Botes, CEO of Citadel Global.
BUDGET IN A FEW WORDS | Will pay no more taxes to fund the government’s 19.3 billion rand vaccination campaign
In his speech, Mboweni affirmed that the state of the deficit remains dire and that SA registers the largest fiscal deficit in its history, which Botes described as worrying. “The cost of debt is also growing rapidly, which is a risk factor.”
The local unit dropped to R14.50 / $ after the speech, but maintained an overall positive response to the Budget.
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