Austere South African budget fails to reassure investors

CAPE TOWN (Reuters) - South Africa's austere budget, aimed at avoiding credit rating downgrades, failed to reassure investors and the rand fell more than 3 percent against the dollar while government bond yields soared.

The package of spending cuts, civil service job freezes and moderate tax hikes on property sales, fuel, alcohol and capital gains may not go down well with voters either ahead of municipal elections this year in which the ruling African National Congress faces a stiff challenge from the opposition.