The South African rand whips around after ruling party withdraws expropriation bill
- The South African rand rose 1% before erasing gains Tuesday.
- The African National Congress ruled to withdraw a land-reform bill passed in 2016.
- Watch the South African rand trade in real time here.
The South African rand seesawed Tuesday after the country's ruling party withdrew a land-reform policy passed by parliament in 2016 amid a constitutional review.
The rand erased gains of as much as 1% - to below 14 per US dollar - after the parliament's portfolio committee on public works ruled to withdraw the bill enabling plans to expropriate land without compensation. The party said it was withdrawn in efforts to allow "an ongoing process that could lead to the changing of the constitution to pave way for expropriation of land without compensation," Reuters reports.
The currency had come under pressure after Trump commented on the policy in a tweet.
"I have asked Secretary of State @SecPompeo to closely study the South Africa land and farm seizures and expropriations and the large scale killing of farmers," Trump tweeted. "'South African Government is now seizing land from white farmers.'"
He tagged Fox News host Tucker Carlson, who had just taken aim at the State Department for not weighing in on the proposed land reforms.
Jameel Ahmad, global head of currency strategy at FXTM, said the tweet added further selling pressure "on concerns that South Africa could be next in line to face the wrath of President Trump."
"The United States President recently tweeted around one of the most sensitive issues in post-apartheid history, land reform," Ahmad said.
"The tweet from Trump initially prompted fears that South Africa could unexpectedly find itself as the next nation to be under the public eye due to President Trump's focus of attention."
