South Africa's stock market traders are bracing themselves for further falls in share prices in the wake of finance minister Trevor Manuel's resignation.
Stocks fell sharply on Tuesday as analysts worried that inflation could rise, spooking foreign investors.
The rand has extended Tuesday's 3% fall against the dollar on fears about South Africa's economic policy.
However, Mr Manuel has said he will work with the new leaders of the African National Congress (ANC).
Mr Manuel has overseen the country's longest economic expansion on record, as well as its first budget surplus, since he took office in 1996.
Volatility
In the wake of his decision to quit the rand sank to 8.2176 against the dollar, from 7.9875 a day earlier. On Wednesday, it fell further to trade at 8.1713.
But experts said the latest fall could be put down to thin trade as the South African markets were closed for a public holiday.
Meanwhile, during Tuesday the Johannesburg Stock Exchange recorded its biggest drop since 1 August, slipping 3.8%, before recovering slightly after Mr Manuel indicated he was prepared to stay in the post if asked.
News of his decision came as official figures showed consumer price inflation surged to a new record high of 13.6% in August, way ahead of government targets of 3-6%.
Further data also showed that retail sales had dropped for their third month in a row, slipping 4.6% year-on-year in July.
Economic worries
The report left a question mark over whether the government can raise interest rates again after raising them to 12% from 7% over the past two years.
"The strength of South Africa is that its institutions are strong and the Treasury is larger than one person"
Analysts fear the sales data shows shoppers are already buckling under the dual pressures of high inflation and high rates.
But Mr Manuel shrugged off claims that his resignation had sent shockwaves through the market saying: "I don't credit myself for that kind of stuff.
"This is not about moving markets, this is about fighting for principle in politics," he added.
"There is no crisis, there was no crisis. The rand fell significantly in a short period of time but we have lived through similar turbulence at different times."
Analysts said Mr Manuel's position in the cabinet is seen as crucial to the country's economic stability for foreign investors - particularly in the light of the latest transition in government.
Uncertainty
Experts have also expressed concern at the way the news was handled, particularly during the current wave of uncertainty affecting world money markets.
"I think if we have a look of what happened to the rand and to the stock market straight after the announcement - that was a lot more telling," said Dermot Quinn Head of Global Markets at Royal Bank of Scotland Group.
"We did see a little bit of a correction ... So the markets are concerned and there is a lot of uncertainty out there."
However, Hendrik du Toit, chief executive of Investec Asset Management, said the uncertainty affecting the markets was likely to end with the announcement of a new cabinet.
"It is basically in the market already, when the new president announces the new cabinet on Thursday, from then on the market will be focused," he said.
Instead of domestic politics the market will return to being driven by the "global situation" currently affecting finance markets, he added.
Mr Mbeki is due to step down on Thursday. A further 10 ministers and three deputy ministers have also resigned - six of the ministers have said they have "no intention of serving the new government".
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