South African rand slips on Iran uncertainty ahead of key central bank data
- The rand traded at 16.3375 against the dollar , about 0.3% down from its previous close
JOHANNESBURG: South Africa’s rand edged lower in early Tuesday trading, weighed down by high oil prices as hopes for a deal to end the Iran conflict remained uncertain, while central bank data was expected to provide insight into the economic outlook.
At 0619 GMT the rand traded at 16.3375 against the dollar , about 0.3% down from its previous close.
Brent crude futures rose 2%, as a deal to end the war and open up the Strait of Hormuz remained elusive.
U.S. Secretary of State Marco Rubio said negotiating a deal with Iran could “take a few days,” quashing hopes for an imminent end to the conflict after U.S. forces conducted what Washington called defensive strikes in southern Iran.
At around 0700 GMT, the South African Reserve Bank (SARB) will publish the country’s leading business cycle indicator for March, which collects data on vehicle sales, business confidence, money supply and other factors.
In February the leading indicator improved marginally, rising to 120.2 points from 119.6 points in January.
“The continued increase in the leading indicator suggests that, prior to recent developments, the domestic economy was on track for another year of improved economic growth,” said ETM Analytics in a research note.
“However, supporting factors are now reversing: inflation is rising sharply, interest rates are likely to increase, gold prices have slipped back, the fiscal outlook is expected to deteriorate, and economic growth in 2026 will likely be weaker,” ETM Analytics added.
The country’s central bank will announce its interest rate decision on Thursday and economists polled by Reuters anticipate a 25 basis point hike.South Africa’s benchmark 2035 government bond was flat in early deals, with the yield at 8.515%.
Comments