JOHANNESBURG: South Africa's rand was trading near its lowest level in more than two months on Tuesday amid fears the US Federal Reserve could begin tapering its stimulus sooner than thought.
The rand was at 10.4010 to the dollar at 0554 GMT, down nearly 0.2 percent from Monday's New York close.
It breached the 10.40 barrier on Friday for the first time since the end of August following stronger-than-expected US non-farm payrolls data.
The employment numbers have heightened expectations that the Federal Reserve will reduce its bond-buying stimulus before next March, strengthening the dollar and putting risky assets such as the rand under pressure.
South Africa's large current account and budget deficits have increased its vulnerability.
"It goes without saying that the rand remains as fragile as ever owing to its status as one of the fundamentally less stable high-yield emerging market currencies and the impact of this status is being shown clearly in its performance since late October," Tradition Analytics wrote in a note.
Yields on the 2026 government bond and the 2015 paper climbed 5 basis points each to 8.375 percent and 6.27 percent respectively, their highest since the beginning of September.
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