Views Article – Sharenet Wealth

Africa, Forex

South African rand slips, bonds firm as dollar on front foot

(Updates to reflect afternoon trade)

JOHANNESBURG, May 4 (Reuters) – The South African rand weakened against a dominant dollar on Tuesday, erasing the previous day’s gains as investors awaited upcoming data and policy speeches.

At 1530 GMT, the rand traded at 14.4950 against the dollar, 0.6% weaker than its previous close.

In the absence of major shifts in South Africa, the rand has taken its cue from global sentiment in recent weeks.

Although rand assets offer some of the highest real returns in major emerging markets, Africa’s most industrialised economy faces challenges, including a rapid build-up in public debt exacerbated by the COVID-19 pandemic.

Government bonds firmed on Tuesday, with the 2030 issue yielding 9.15%, down 4 basis points.

On the Johannesburg bourse, shares dropped with the opening of the U.S. market, which saw a technology-led stock sell-off.

The Johannesburg Stock Exchange’s all-share index closed down 0.62% at 66,174 points, and the blue-chip index dropped 0.65% to 60,376 points.

The banking and industrials indices fell 0.64% and 1.18%, respectively. Bourse heavyweight Naspers lost around 2%. (Reporting by Alexander Winning and Promit Mukherjee; Editing by Alexander Smith)

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