South Africa's rand weaker as national lockdown approaches

The rand was 0.4pc weaker at 17.4050 per dollar, snapping a two-session rally that had driven the unit to 17.1900,
26 Mar, 2020
  • The rand was 0.4pc weaker at 17.4050 per dollar, snapping a two-session rally that had driven the unit to 17.1900, its firmest since Friday.
  • Bonds kicked-off firmer, with the yield on the benchmark paper due in 2026 down 10 basis points to 10.515pc.

At 0630 GMT the rand was 0.4pc weaker at 17.4050 per dollar, snapping a two-session rally that had driven the unit to 17.1900, its firmest since Friday.

The South African Reserve Bank (SARB) announced that it would purchase government bonds for an unlimited period, as well as providing extended short term lending for commercial banks in a bid to ease increasing liquidity pressure due to the coronavirus.

"Today, the markets are likely to trade cautiously, although the rand has some room for further improvement towards the 17.0000 handle in the short term," Nedbank economist Reezwana Sumad said in a note.

Bonds kicked-off firmer, with the yield on the benchmark paper due in 2026 down 10 basis points to 10.515pc.

South African President Cyril Ramaphosa said on Monday that the government would impose a nationwide 21-day lockdown from midnight on Thursday to contain the coronavirus outbreak.

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