Rand plunges as polls show Zuma eating into ANC’s support

The rand fell from the year’s best levels after a new opinion poll showed support for the ruling African National Congress is plunging, and a party backed by former President Jacob Zuma may become the country’s third-biggest.

The South African currency depreciated as much as 0.9% to 18.62 per dollar after Bloomberg reported the result of the poll by the Social Research Foundation Wednesday.

Prior to this, the rand had been strengthening for a fourth day, its longest streak in a month. 

“Uncertainty in South African politics increased markedly after the latest poll revealed that support for the governing ANC plunged while former President Zuma’s party may become a major political force,” said Piotr Matys, a currency analyst at InTouch Capital Markets. 

The ANC, which has governed South Africa since the end of apartheid, may garner just 37% support in the May 29 vote, while Zuma’s uMkhonto weSizwe Party, or MKP, may get 13%, the SRF said, citing a poll it carried out this month.

Such a result would mean the ANC has to form a coalition with a large party in order to retain control of Africa’s most industrialized economy.

Zuma’s decision to back the MKP has eaten away at the ANC’s support. He ruled the country from 2009 to 2018 when the ANC forced him from office.

On Tuesday, Zuma won a court bid to overturn his disqualification from running for parliament in next month’s election on the MKP’s ticket.

The decision is another setback to the ANC’s efforts to stifle support for the MKP ahead of the May 29 vote. Last month, the ANC lost a court bid to have the party deregistered.

Zuma led South Africa for nine years marred by scandal, including allegations of large-scale corruption and the looting of billions of dollars of state funds.

He has denied wrongdoing and hasn’t been indicted on the accusations. He was forced to resign as president in February 2018 after the ANC elected Cyril Ramaphosa to succeed him as party leader in December 2017.