* Rand firms after Gordhan spending cap pledge
* Bonds weaken on lower revenue fears
* Producer inflation lower than expected
By Vuyani Ndaba
JOHANNESBURG, Oct 25 (Reuters) – South Africa’s rand firmed
against the dollar on Thursday after Finance Minister Pravin
Gordhan promised to keep a tight lid on spending despite having
to widen his 2012 budget deficit forecast due to the worst
mining strikes since apartheid.
The rand was at 8.74 against the dollar at 1533 GMT
from Wednesday’s close of 8.7810 in New York.
It strengthened to as much as 8.685 shortly after Gordhan
vowed in his Medium Term Budget Policy Statement (MTBPS) to
crack down on government wastage and corruption as a
counterweight to slightly lower economic growth than his
February forecast.
The Treasury projected a 2012/13 budget deficit at 4.8
percent of GDP, in line with a Reuters poll of economists, from
4.6 predicted in February. South Africa’s growth forecast was
also cut to 2.5 percent from 2.7 percent.
“The rand strengthened a little bit but was in a very tight
ranges today,” said Ion de Vleeschauwer, a trader at Bidvest
Bank in Johannesburg. “There was nothing really earth-shattering
in the speech that could influence the currency.”
Continued…
