The rand’s volatility is soaring as a scandal involving South African President Cyril Ramaphosa and the sale of buffalo once again shakes investor confidence.
The currency’s one-month implied volatility surged by the most in a month after South Africa’s tax authority said it’s unable to find records of the cash allegedly used by a Sudanese businessman to purchase the animals. The rand dropped as much as 0.7% against the dollar.
“Political uncertainty may resurface,” said Piotr Matys, senior foreign exchange analyst at InTouch Capital Markets. “With the opposition determined to find out the truth about those funds, President Ramaphosa may face fresh calls for impeachment.”
The scandal — tied to the buffalo profit that Ramaphosa failed to report stolen — is now once again threatening to roil South African financial markets.
An advisory panel found last year that the leader may have breached the constitution over his handling of the theft of at least $580,000 that had been stashed in a sofa at his game farm.
Lawmakers later quashed the report, scuppering a potential impeachment inquiry, though opposition members of parliament have called for further investigations into the matter.
The main opposition Democratic Alliance had asked the South African Revenue Service to confirm that the businessman complied with a legal requirement to declare the foreign currency upon his arrival in the country.
The agency said in a statement Monday that it “is not in possession of the said record.”
Ramaphosa is expected to announce changes to his cabinet as he secures stronger support within his party.