Rand likely to stay under pressure

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NewRandMoney Reuters.

Johannesburg - South Africa's rand began the week on a stable footing against the dollar but could struggle to consolidate gains made after disappointing US jobs data on Friday.

The rand was at 11.0480 to the dollar at 08:37 SA time, 0.1 percent firmer than Friday's New York close.

The currency strengthened beyond the key 11 level to 10.9400 on Friday after US nonfarm payrolls rose by a less-than-expected 113,000 in January, before ending the session at 11.0600.

An ongoing strike in the platinum mining sector which is showing signs of becoming violent, as well as poor sentiment towards emerging markets, could keep the rand under pressure this week.

On Friday, a union shop steward was killed in a clash with police at an Anglo American Platinum (Amplats) mine, one of three affected by a strike that began more than two weeks ago.

“While downside moves below 11.00 have been opened, we expect a sideways drift this morning and we wouldn't be surprised to see some losses as the week progresses,” Rand Merchant Bank analysts wrote in a note.

The yield on the 2026 and 2015 paper government bonds rose 3.5 basis points each to 8.71 percent and 7.13 percent respectively. - Reuters

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