Illustration photo of South African rand

South African rand weakens on subdued investor risk sentiment

JOHANNESBURG (Reuters) - South Africa's rand retreated early on Wednesday before the U.S. Federal Reserve's monetary policy announcement and amid subdued investor appetite for riskier assets.

* At 0650 GMT the rand was 0.2 percent weaker at 14.3750 per dollar, having closed in New York at 14.3450.

* The rand remains under pressure as it awaits reaction on the U.S. Federal Reserve Bank interest rate decision on Wednesday. The Fed is expected to raise interest rates for the eighth time since late 2015.

* Investors also remain cautious following second-quarter gross domestic product data on Sept. 4 which showed the economy entered into a recession.

* A statement by ratings agency Fitch on Tuesday said it was unlikely President Cyril Ramaphosa's economic multi-billion-dollar turnaround plan would be enough to lift the country’s sluggish economic growth rate.

* In fixed income, the yield on the benchmark government bond due in 2026 was up 0.5 basis points to 9.155 percent.

* Stocks are due open higher at 0700 GMT, with the JSE securities exchange's Top-40 futures index up 0.44 percent.

(Reporting by Nomvelo Chalumbira; Editing by Edmund Blair)

2018-09-26 10:01:22

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