South African currency weakens to a record low after finance minister is fired

The abrupt firing of South Africa's finance minister created uncertainty about Africa's second-largest economy Thursday as its currency plunged to an all-time low.

The rand hovered around 15 to the dollar Thursday, after the Johannesburg Stock Exchange had closed on 14.59 the day before, according to online business site, Moneyweb.

Finance Minister Nhlanhla Nene was replaced after serving for less than two years by David van Rooyen, a former mayor and member of parliament who has served on financial committees.

President Jacob Zuma made the announcement late Wednesday but gave no explanation for Nene's removal. Van Rooyen was sworn in Thursday during a brief ceremony in the capital, Pretoria.

The main opposition party, the Democratic Alliance, called Zuma's decision "reckless and irrational," saying Nene was fired because he opposed "excessive spending" on a proposed deal with international energy companies to build nuclear power stations and on new aircraft purchases for South Africa's struggling national airline.

South Africa's economic outlook has become increasingly uncertain. The country narrowly avoided recession in the last quarter, managing less than 1 percent growth, according to Statistics South Africa, a government agency.

Last week, citing policies that have not yielded results, international ratings agencies downgraded the country's credit rating to just above junk status. Ratings agency Fitch downgraded the country to BBB-, while Standard & Poor's maintained South Africa's rating, but revised the outlook to negative.

The Banking Association of South Africa noted that Nene had tried to curb public spending as part of a sensible fiscal policy that was managing the country's debt and criticized the appointment of an unproven successor.

"In the midst of these problems and uncertainty, the minister is fired and replaced by somebody who is not known by the markets, business or any other sector," said Cas Coovadia, the banking association's managing director.