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Rand eases ahead of data, bonds gain

Johannesburg - The rand eased slightly against the dollar in early trade on Thursday ahead of key domestic current account data and amid more weakness in the euro, the currency of South Africa's largest trading partner.

The rand traded at 8.7775 at 0639 GMT against the greenback, marginally softer than Wednesday's New York close of 8.7650.

File photo: AP

Jim Bryson, a currency trader at Rand Merchant Bank, said previous current account figures had put pressure on the currency, and a worse-than-anticipated figure for the third quarter would add to that.

“Going on the last couple of figures, I wouldn't expect anything too cheerful,” Bryson said.

Economists surveyed by Reuters expect the third quarter deficit to have swollen to 6.55 percent of gross domestic product, after posting its biggest figure in over three years in the second quarter, at 6.4 percent of GDP.

The data will be released at 0800 GMT.

In the euro zone, the European Central Bank is widely expected to keep rates on hold at 0.75 percent at its policy meeting, although it is likely to paint a gloomy economic outlook, with cuts to its growth forecasts for this year and next.

Investors will look for clues about whether ECB President Mario Draghi will show a greater willingness to cut borrowing costs in the future.

South African government bonds firmed ahead of the data, with yields nudging down 2.5 basis point to 7.485 percent on the 14-year benchmark bond and a single basis point on the 2015 note to 5.495 percent. -Reuters

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