Rand (Photo : Exchangeratecalculator)
It is not just Asian markets that suffered bloodbaths as a result of the market turmoil in China. For the first time in seven years, the South African rand collapsed on Monday as value tumbled down by up to 10 percent to 17.9169 per dollar.
It was the worst performance of the South African currency since October 2008, observes Bloomberg. Monday's event was preceded by a 25 percent drop in value of the rand in 2014 due to weak commodity prices, lackluster economic expansion and rise in U.S. interest rates.
In early trading, the rand dipped to almost 10 percent before it recovered and traded at a historic low of 16.57.
The situation worsened in December after South African President Jacob Zuma fire his finance minister but changed his decision the following day. However, it was the bloodbath in China that caused further damage on the country's currency since South African sold 37 percent of its exports, mainly oil and minerals, to China in 2014.
The acceleration in currency declines spread across the continent, felt in national economies. For instance, mining companies in Zambia laid off thousands of workers, while income deficiency in Nigeria and Angola delayed the payment of salaries of nurses and teachers, reports The Wall Street Journal.
While African currencies were bleeding, the yuan's reference rate strengthened slightly for a second day on Monday after eight consecutive days of declines that sent seismic waves through financial markets.
