South Africa‘s rand fell more than 1.5% on Monday after Public Protector Busisiwe Mkhwebane recommended changes to the constitution to force the South African Reserve Bank to promote economic growth rather than currency and price stability.
By 1222 GMT, the rand was trading 1.44% weaker to the dollar at 12.9900, having hit 13.0075.
Mkhwebane said at a news conference that the primary objective of the South African Reserve Bank should be to promote balanced and sustainable economic growth, rather than to target inflation, as it is now.
It is unclear why Mkhwebane, a constitutionally mandated anti-corruption watchdog, should have made the comments, which alarmed currency traders.
“They want to initiate changes to alter the primary objective of the Reserve Bank. Some of the suggestions being to remove the reference to protect the value of the currency and all this has caused a knee-jerk reaction,” said Andre Botha, Treasury One currency dealer.
