JOHANNESBURG: South Africa’s rand slipped in early trade on Thursday ahead of September producer inflation and trade balance data, while investors awaited the finance minister’s answers to lawmakers’ questions on his mid-term budget.
At 0820 GMT, the rand traded at 17.72 against the US dollar, about 0.4% weaker than its previous close.
The dollar last traded about 0.1% weaker against a basket of currencies.
Finance Minister Enoch Godongwana will respond to lawmakers’ questions later in the day, after his Medium-Term Budget Policy Statement (MTBPS) on Wednesday showed that wider budget deficits and higher debt are expected over the next three years.
“The rand initially lost some ground post-MTBPS, but this reaction was largely overshadowed by a stronger dollar,” said Andre Cilliers, currency strategist at TreasuryONE.
“The currency remains sensitive to global dollar movements and domestic fiscal signals,” Cilliers added. Local investors will also look to September producer inflation figures and trade balance data due later in the day.
South African rand edges higher as investors await mid-term budget
“An ongoing trade surplus would support economic growth and help offset fiscal challenges, lending the rand some resilience,” Cilliers said. On the stock market, the Top-40 index was down about 0.7% in early trade.
South Africa’s benchmark 2030 government bond was weaker in early deals, with the yield up 3 basis points to 9.315%.
Comments
Comments are closed for this article.