Trump said, without citing evidence, that "SA is confiscating land" and "certain classes of people" were being treated "very badly" on Sunday, adding that he would cut off funding until the matter was investigated.

SAPresident Cyril Ramaphosa, who recently signed into law legislation allowing land to be expropriated under specific conditions, said his government had not confiscated any and he would talk to Trump to foster a better understanding.

The Rand traded at 18.8450 against the US Dollar , 0.7% weaker than its closing level on Friday. Earlier in the day it was down almost 2%.

On the Johannesburg Stock Exchange, the Top-40 index was 0.5% lower, while the benchmark 2030 government bond price slid and the cost of insuring SA debt against default rose to its highest since early August.

US funding to South Africa mainly involves supporting its HIV/AIDS programme, but Trump's comments caused investor unease about the potential for a broad review of diplomatic and economic ties.

Casey Sprake, an investment analyst at Anchor Capital, said the autos and agriculture sectors were especially vulnerable as South Africa currently enjoys duty-free access to the US market under a Clinton-era trade initiative.

Annabel Bishop, an Investec economist, said the rand was also under pressure due to Trump's tariffs on Canada, Mexico and China, which sent global currencies to multi-year lows.

South African manufacturers, meanwhile, posted a deterioration in business conditions for a third month in a row.


--Reuters--