The South African Rand has weakened against the Pound and fallen against the US Dollar after the markets were spooked by the murder of a worker at the Marikana platinum mine, the incident came almost a year after 44 died in violence at the same site.
The news caused the Rand to falter as the incident raised the possibility of further violence in the already troubled mining sector. Monday’s incident saw a female employee at the Lonmin owned Platinum mine shot dead, the latest in a string of shootings. The employee was shot whilst walking in the community next to the mine.
“If the killing hadn’t been at that mine and almost exactly one year after the multi-death tragedy, it would probably have been ignored,” said John Cairns, a currency strategist at FirstRand Ltd’s Rand Merchant Bank Unit.
Tensions are already high as wage negotiations between workers and mining companies make little progress. Talks between labour unions and gold producers began in July with the offered 4% pay rise being flatly rejected. Also adding to the sectors worries was the news that Coal workers yesterday declared a dispute with employers after they rejected a 7% pay rise offer.
The South African economy is being badly damaged by the ongoing unrest in the mining sector and data released earlier this month showed how much labour stoppages and tensions continue to hinder output. According to government data, mine production in June tumbled by 6.2% compared to the previous year.
The rivalry between the National Union of Mineworkers, which is aligned with South Africa’s ruling African National Congress, and relative newcomer the Association of Mineworkers and Construction Union has fuelled much of the labor unrest.
“Amid the increasing assassinations in Marikana and the broader Rustenburg area, there has not been any progress with regard to the arrest and prosecutions of the suspects,” NUM spokesman Lesiba Seshoka said.
With tensions so high and following this latest death the situation for South Africa’s mining sector looks set to remain negative and will weigh heavily upon the Rand.
Current South African (ZAR) Exchange Rates:
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The US Dollar/South African Rand Exchange Rate is currently in the region of: 9.9266 >
The Pound Sterling/South African Rand Exchange Rate is currently in the region of: 15.3459 >
The Euro/South African Rand Exchange Rate is currently in the region of: 13.1914 >
The Australian Dollar/South African Rand Exchange Rate is currently in the region of: 9.0613 >
The New Zealand Dollar/South African Rand Exchange Rate is currently in the region of 7.9342 >
The Canadian Dollar/South African Rand Exchange Rate is currently trading in the region of 9.6127 >
(Correct as of 12:45 pm GMT)
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