Rand marks biggest weekly drop in month

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NewRandMoney Reuters.

Johannesburg - The rand recorded its biggest five-day drop in a month as political turmoil in Ukraine roiled emerging markets and as foreign investors renewed a debt selloff in Africa’s biggest economy.

Only six of 24 currencies from developing nations managed to eke out gains this week as Ukrainian President Viktor Yanukovich agreed on a plan to resolve as crisis that saw at least 77 anti-government protesters killed.

Overseas investors sold 266 million rand ($24 million) of South African debt yesterday, the third day of outflows this week, according to stock exchange data.

“Emerging-market issues remain in the background. The market is sceptical of Ukraine’s problems,” John Cairns and Theuns de Wet, analysts with FirstRand Ltd.’s Rand Merchant Bank, said in an e-mailed note to clients.

“Global risk appetite remained under pressure.”

The rand weakened 0.2 percent to 11.0270 per dollar by 10:53 a.m. in Johannesburg, bringing its five-day decline to 1.6 percent, the most since the period to January 24.

Yields on benchmark local-currency government bonds due December 2026 fell two basis points, or 0.02 percentage point, to 8.65 percent.

Investors sold emerging-market stocks for a 17th consecutive week, according to Citigroup Inc.

Foreign investors extended their selloff of South African equities, offloading 169 million rand yesterday for year-to-date outflows of 5.8 billion rand. - Bloomberg News

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