South African rand falls further before key economic data
(Updates to reflect afternoon trading)
JOHANNESBURG, June 12 (Reuters) - South Africa's rand fell
for a fourth successive day on Tuesday, trading near a six-month
low before retail sales and mining data later in the week.
At 1520 GMT, the rand traded at 13.2400 per dollar,
around 0.7 percent weaker than its close on Monday.
South African assets have been hurt by disappointing gross
domestic product data and an unfavourable external backdrop
which has seen global investors pull back from emerging markets.
Rising U.S. bond yields and the increasing likelihood that
the South African Reserve Bank (SARB) will raise its main
lending rate in the coming months have also hurt the rand by
dampening appetite for local bonds.
The yield on the benchmark 2026 government bond
hit its highest since mid-December on Tuesday, reflecting weaker
"Rand weakness is partly a bond story," said Halen Bothma at
ETM Analytics. "Bonds tend to perform worse in a rate-hiking
cycle which is where the SARB looks headed".
For now, few local banks are adjusting their rand forecasts
downwards and officials are urging calm.
South African President Cyril Ramaphosa has promised
ambitious economic reforms which should buttress the growth
outlook later in the year, rekindling investor appetite for rand
After a 2.2 percent contraction in first-quarter GDP, retail
sales and mining figures on Wednesday and Thursday will give a
clue as to how the economy fared in the second quarter.
Stocks listed in Johannesburg ended Tuesday slightly
The Top-40 index closed 0.1 percent higher at
51,909 points, and the broader All-share index climbed
0.1 percent to 58,207 points.
Miner Sibanye-Stillwater's shares were an
exception, falling 3.8 percent after the firm said four
employees were killed at one of its mines.
(Reporting by Alexander Winning and Nomvelo Chalumbira
Editing by Alison Williams)
First Published: 2018-06-12 08:29:57
Updated 2018-06-12 17:41:06
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