JOHANNESBURG, Jan 16 Reuters The South African rand dropped on Monday after President Cyril Ramaphosa cancelled a trip to the World Economic Forum WEF in Davos to deal with the country39;s energy crisis, as struggling state utility Eskom39;s worst ever power cuts continued.

The South African rand traded at 17.065 against the U.S. dollar at 0930 GMT, 1.29 weaker than its previous close and its weakest level since Dec. 1.

That reversed a rise to as high as 16.75 in early trading, as the dollar extended last week39;s fall after data showed U.S consumer prices fell for the first time in more than 212 years in December. That led investors to bet the Federal Reserve may be nearing the end of its interest ratehike cycle.

What we39;re seeing right now is potentially a realisation of the ramifications of where we are with Eskom and also a bit of unwinding in the USDZAR shorts that were on, Quinten Bertenshaw, executive director of ETM Analytics.

Recent strengthening in the rand had been a dollar play, he said, adding, we haven39;t broken any key technical levels as yet. I think the first big level that I would worry about that would signal a reversal for me, would be closer to the 17.20 mark.

Eskom said on Tuesday it would implement Stage 6 power cuts until further notice, due to the breakdown of several power generating units. This requires up to 6,000 megawatts to be shed from the national grid and at least six hours a day without power for most South Africans.

Finance…