Johannesburg - South Africa's rand weakened against the dollar in early Monday trade and could extend losses if the current account deficit for the second quarter comes in wider than expected.
The Reserve Bank will release current account data in its latest quarterly bulletin on Tuesday, and analysts polled by Reuters expect it to widen to 5.45 percent of GDP from 4.5 percent in the first quarter.
The rand traded at 10.7350 to the greenback at 08:49 SA time, 0.42 percent weaker than Friday's close in New York.
Government bonds were flat at the start of trade, with yields on the 2026 paper and the 2015 issue at 8.005 percent and 6.55 percent, where they last changed hands on Friday.
The local currency was not likely to budge out of its current 10.6600 and 10.7400 range ahead of Tuesday's current account data, Standard Bank trader Warrick Butler said, predicting a shortfall of at least 6 percent of GDP.
“Should it come out north of our expectations then the dollar will continue to grind out value against the rand,” Butler said.
“I would use this as a possible entry point to get into a longer term long rand position as it feels like the world has priced in too much movement in global interest rates for the remainder of the year.”
The rand has lost nearly 3 percent against the dollar since the start of 2014, extending last year's weakness.
This has boosted the performance of companies like petrochemicals firm Sasol, which on Monday partly attributed its 14 percent increase in full-year earnings to the weaker currency. - Reuters