Rand eases against the US dollar

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NewRandMoney Reuters.

Johannesburg - South Africa's rand weakened slightly against the dollar on Monday as political tensions in Ukraine continued to drive global risk aversion.

The currency edged close to a week-high of 10.6250 before pulling back within its recent range, trading at 10.6858 by 14:10 SA time, down 0.16 from its New York close on Friday.

Government bonds were slightly stronger, with yields on the benchmark 2015 paper down 1 basis point to 6.695 percent and that on the 2026 bond dipping 1.5 basis points to 8.3 percent.

Investor uncertainty driving capital flows out of eastern Europe and into safer emerging markets such as South Africa remains a factor after hopes for a ceasefire in eastern Ukraine evaporated.

Traders expect the local unit to remain within a range of 10.50 and 10.80 ahead of domestic retail sales data on Wednesday and mining sales numbers on Thursday.

“Expectation of weak local data has been broadly priced in already,” Christie Viljoen of NKC Independent Economists said in a market note to clients.

“Further deterioration in the situation in Ukraine and standoff between Russia and West could hurt emerging market currencies and send the South African currency to beyond 10.86 versus the dollar.” - Reuters

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