JOHANNESBURG: South Africa's rand was on shaky ground against the dollar in early Monday trade and government bonds were also weaker, nudging yields higher, with the latest data showing foreigners have sold local debt in the past week.
The rand was down 0.24 percent at 8.22 against the greenback by 0648 GMT, within sight of last Thursday's four-week low of 8.2651.
The rand is down nearly 24 percent against the dollar this year, and has consistently traded weaker than 7.8 since late September as investors seek safe haven assets, mainly due to worries about euro zone debt.
"All this poor management of the major developed economies of the world over which South Africa has no control is dealing a blow to local growth and inflation through the sustained weakness in the rand," Tradition Analytics said in a note.
Data due out later this week is likely to show that inflation is continuing to rise, part of the reason why the Reserve Bank has held back from cutting rates this year from their 30-year lows.
Government bonds also weakened on Monday, with the yields on the heavily traded 2015 and 2026 government bonds each adding 2.5 basis points to 6.815 percent and 8.475 percent respectively.
Foreign investors have sold 2.1 billion rand of South African debt in the last five days, latest data from the JSE Securities Exchange shows.
"Bond yields in the middle to longer end of the yield curve reflect the risks associated with doing business in SA as they trade at elevated yield levels," Tradition said.
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