Driven by the imposition of new tariffs by the U.S. administration and the escalating global trade tensions, the South African rand depreciated to its weakest level in 18 months.

The currency’s decline is indicative of investor apprehension regarding the potential impact of these tariffs on the overall economic stability and export sectors of South Africa.

The Johannesburg Stock Exchange also encountered substantial volatility, with main indices experiencing a decline that was partially reversed later in the trading session.

Economists caution that the combination of a weaker rand and increased trade barriers could result in higher import costs and inflationary pressures within South Africa.

According to reports, the government is investigating strategies to alleviate these effects, such as diversifying export markets and requesting exemptions from specific U.S. tariffs to decrease dependence on a single trading partner.

The interconnectedness of global trade policies and their profound impact on emerging economies are underscored by these developments.