South Africa’s ruling African National Congress dismissed a media report on Tuesday that President Jacob Zuma’s removal would be discussed at an ANC meeting this weekend as untrue.
Analysts also poured water on the likelihood of Zuma being ousted or stepping down before his term as ANC head ends in December. Zuma faces a no-confidence vote in parliament that analysts said is likely to fail due to the broad support and control he enjoys over the ruling party and the economy.
Opposition to Zuma inside the ANC and from opposition parties and civil society groups, however, has swelled since he axed respected finance minister Pravin Gordhan in late March, triggering credit downgrades to “junk” by two rating agencies.
On Tuesday, Bloomberg quoted two anonymous sources as saying the ANC would discuss the removal of Zuma at a meeting of top party leaders at the weekend, a report that firmed the rand by 1.5 percent against the dollar.
ANC spokesman Zizi Kodwa denied the report, saying it was “a complete fabrication and not true”.
A senior member of the ANC’s National Executive Committee (NEC) told Reuters he was unaware of any changes to the draft agenda of a major policy meeting at the end of June.
NKC African Economists analyst Gary van Staden said Zuma wielded enough control over the ANC to defeat the no-confidence vote in parliament as well as any internal party challenges.
“The cabinet reshuffle has demonstrated one clear problem. To characterise Zuma as a weakened president on his way out would be to underestimate the patronage networks he has around him and supporting him,” he said.
“We need to understand that the ANC would know exactly which lawmakers are likely to rebel and vote against the president and I’ve no doubt they are being persuaded otherwise.”
The firming currency highlighted the perception by investors that an early Zuma exit would be a positive for the economy, which is on the brink of a technical recession after contracting in the final quarter of 2016.
“There might be a very short-term positive impact especially in the markets. We would see the rand exchange rate appreciating a lot and bond yields declining,” said economist Elize Kruger.
A bid to remove Zuma by at least three cabinet ministers during a party meeting in November saw the currency gain nearly 4 percent in two days before retreating when Zuma prevailed.