South African rand tanks again as new finance minister steps in

South Africa’s new finance minister Malusi Gigaba has criticised the economic management of the country in his first days since taking up the office, with the rand plummeting a further 1.5% to hit a two-month low on Monday.

Pravin Gordhan was sacked by President Jacob Zuma last week and the decision sent the currency 5% lower against the US dollar.

Gordhan was seen as a steady hand and Zuma faced criticism for the sacking, while several other government ministers also lost their positions in a turbulent week for South African politics.

Gigaba spoke on Saturday of the need for a radical transformation in how the South African economy operates.

"The issue of radical economic transformation arises from a criticism that for quite a long time the structure of the South African economy has not been changed. We have not paid sufficient attention to the real economy, to industrializing the economy, to ensuring that we create entrepreneurs and industrialists, particularly among black people," the new finance minister told reporters.

There are worries that credit rating agencies such as Moody’s and Fitch will downgrade South Africa to “junk” following last week’s political upheaval.

"Zuma's strategic move is perceived as an attempt to strengthen his power on the country’s finances and raise tensions at the heart of the government...The heavy headwinds suggest the possibility of a further rise in USDZAR to 14.00/14.50," asserted London Capital Group’s senior market analyst Ipek Ozkardeskaya.

As of 13:10 GMT, one US dollar was worth 13.5630 South African rand.