The rand was little changed in early trade on Monday‚ but retained its recent weaker tone‚ with little fresh news to offer direction.
At 8.45am‚ the rand was bid at R8.8745 to the US dollar from R8.8757 at Friday’s close. The local currency was bid at R11.8234 to the euro from its previous close of R11.8247 and at R14.0911 against sterling from R14.0576 before.
The euro was bid at $1.3324 from Friday’s close of $1.3316.
“The rand weakened across the board last week on the back of intensifying concerns about SA’s fundamental backdrop‚ which are being aggravated by the country’s heightened labour tensions in the mining and farming sectors. More specifically‚ the rand weakened 2.1% in relation to the US dollar‚ 1.6% versus the euro and 2.0% against the Japanese Yen last week and remains the worst-performing currency year to date‚” Absa Capital analysts said in a note.
They added that increased idiosyncratic risks were well reflected by the current lack of capital inflows to SA‚ especially at a time when other emerging markets and other risky assets are managing to attract large-scale capital inflows as a result of the risk-on global trading environment.