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Africa, Forex

South African rand weaker amid global economic uncertainty

(Updates rand to reflect afternoon trade, adds stocks)

JOHANNESBURG, May 13 (Reuters) – The South African rand slipped on Friday and was on course for a weekly loss of almost 1% versus the dollar against a backdrop of global economic uncertainty linked to monetary policy tightening and the war in Ukraine.

At 1515 GMT, the risk-sensitive rand traded at 16.1600 against the dollar, 0.4% weaker than its close on Thursday.

This week the rand has mainly tracked global factors. On the domestic front, power cuts by struggling state-owned utility Eskom and rising COVID-19 infections cloud the economic growth outlook.

Market attention next week shifts to a monetary policy decision by the South African Reserve Bank that will be announced on Thursday.

A Reuters poll published on Friday forecast the bank would make its first 50 basis point repo rate hike in more than six years, taking it to 4.75%, to prevent potential second-round effects from higher consumer prices.

A hike could support the rand in the wake of the U.S. Federal Reserve’s 50 basis point hike last week.

On Friday two major indexes on the Johannesburg Stock Exchange rose. The All-share index added 2.08% and the Top-40 index closed up 2.23%.

(Reporting by Alexander Winning and Olivia Kumwenda-Mtambo, Editing by Angus MacSwan)


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