Rand Declines for Third Day After South African Mine Violence
The rand weakened for a third day after clashes between labor unions at an Anglo American Platinum Ltd. mine spurred concern of a repeat of violence that curbed production last year.
The currency of Africa’s biggest economy depreciated as much as 0.6 percent to 8.9471 per dollar, before trading at 8.9087 at 3:30 p.m. in Johannesburg. Yields on benchmark 10.5 percent bonds due December 2026 fell four basis points, or 0.04 percentage point, to 7.28 percent.
Twelve workers were shot with rubber bullets and three security guards were hurt in fighting at Amplats’s Siphumelele mine near Rustenburg yesterday. Machetes and other sharp objects were used in the attacks, according to police. Amplats workers will return tomorrow after experiencing a “widespread” stayaway from the mine, Mpumi Sithole, a company spokeswoman, said in an e-mailed reply to questions today.
“Labor unrest will most likely remain a feature of the economic landscape in the foreseeable future,” John Cairns, a currency strategist at Rand Merchant Bank in Johannesburg, said in e-mailed comments. “This should continue to weigh on the outlook for the exchange rate.”
Strikes in the mining industry and the shooting of about 34 protesters by police at Lonmin Plc’s Marikana platinum mine last year shut gold and platinum mines, reducing South Africa’s gross domestic product by 0.5 percentage point, according to the National Treasury, and contributed to lowering the nation’s credit rating.
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