The rand was poised to break through R12 to the dollar at midday on Monday as optimism about local political developments continued to buoy the local currency.
It was reported at the weekend that the ANC at its national executive committee (NEC) had resolved to remove President Jacob Zuma as head of state. The process will be driven by the ANC’s top-six officials.
Further developments include the appointment of the new board at Eskom‚ while ANC president Cyril Ramaphosa has also tightened his grip on the influential national working committee.
A report from Goldman Sachs‚ saying the bank expected more market-friendly economic policies under Ramaphosa‚ also supported the rand.
The rand last traded under R12 in May 2015.
“The new Eskom board should provide some firing power in the arsenal of Finance Minister Malusi Gigaba as he seeks to restore foreign investor confidence‚” said TreasuryOne trader Gerard van der Westhuizen.
At 11.31am the rand was at R12.0529 to the dollar from R12.0556‚ after having firmed to R12.0289 in the morning.
The rand was at R14.7670 to the euro from R14.7917 and at R16.7603 to the pound from R16.7499.
The euro was at $1.2251 from $1.12272.
The euro lost some ground‚ despite German SPD voting to begin formal coalition talks with Chancellor Angela Merkel’s Conservatives in an attempt to break the deadlock of the last few months and form a new government.
The dollar was steady after the US government shutdown at the weekend as the Senate failed to pass a bill to keep the funds flowing late on Friday.
“How markets will react is still uncertain but risk has increased as a result of political brinksmanship between Republicans and Democrats‚” FxPro analysts said.