South African rand steady before producer inflation, budget balance data
- The rand traded at 16.6575 against the dollar , a whisker away from its previous close
JOHANNESBURG: The South African rand was steady in early trade on Thursday as investors awaited local June producer inflation and budget balance data for fresh signals on the health of the economy.
At 0709 GMT the rand traded at 16.6575 against the dollar , a whisker away from its previous close.
Statistics South Africa will publish June producer inflation numbers at 0930 GMT, with analysts polled by Reuters expecting the print to inch up to 7.9% year on year.
Producer inflation quickened to 7.8% in May, up from 4.8% in April, driven largely by higher petroleum and chemical product costs.
“Another strong print would signal continued pipeline pressure and increase the risk that the fuel shock spreads into core consumer prices,” said ETM Analytics in a research note.
Later in the day, the National Treasury will publish budget balance figures.
Like many emerging market currencies, the rand is sensitive to global risk sentiment and developments in U.S. monetary policy, in addition to domestic economic indicators.
A divided Federal Reserve left interest rates unchanged on Wednesday while Chairman Kevin Warsh reaffirmed the central bank’s commitment to bringing inflation under control.
The US dollar was last up about 0.2% against a basket of currencies.South Africa’s benchmark 2035 government bond was flat, with the yield at 8.65%.