The South African rand was boosted on Tuesday following reports that the African National Congress is discussing options to remove the country’s president, Jacob Zuma, from office, although some gains were trimmed after an ANC spokesman denied the claims.
The rand, which was down as much as 0.7 per cent earlier in the day to $0.075, rallied as much as 1.5 per cent to $0.076 after Bloomberg reported that the ruling ANC’s national executive committee would raise the possibility of removing Mr Zuma at its May 26-28 meeting.
However, an ANC spokesman later told Reuters the reports were “a complete fabrication and not true”. The rand had trimmed its gains to trade about 1 per cent higher at pixel time.
Sentiment on Mr Zuma has soured after he sacked finance minister Pravin Gordhan in March. The move prompted ratings agencies S&P Global Ratings and Fitch to junk South Africa’s sovereign credit rating.
However, Win Thin at Brown Brothers Harriman urged “caution” about Tuesday’s reports, noting that while things have changed since the National Executive Committee rejected Mr Zuma’s ouster in November, “it appears that most ANC lawmakers have fallen behind Zuma and are unwilling to risk a serious split in the ANC ahead of the 2019 elections”.