Rand gains 1.3% since polls - will now look to Ramaphosa's Cabinet picks | Fin24
The options market is giving a one-in-two chance of reaching that level, according to Bloomberg’s probability calculator.
“We are keen to see whether some ministries could be consolidated to give a lower overall number of cabinet posts,” Morgan Stanley strategists including Hans Redeker, James Lord and Sheena Shah wrote in a note to clients. “This would be positive for streamlining policy and an indication of Ramaphosa’s growing authority within the ANC.”
Investors want clarity on the positions of Finance Minister Tito Mboweni and Public Enterprises Minister Pravin Gordhan, or potential replacements should either of them step down, the strategists said.Mboweni is on the ANC’s list of elected lawmakers, increasing the chance he will remain in his post.
A poll conducted by Citigoup on May 14 found that less than 50% of respondents expected Ramaphosa to appoint reform-minded ministers, but most believed he would cut its size. In this scenario, assets would not rally. Only 20% or so expected him to both downsize the cabinet and appoint loyal and untainted ministers to key portfolios. This would unlock the potential for South African assets to rally, according to Citigroup.
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