Rand pulls back from week lows

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NewRandMoney Reuters.

Johannesburg - South Africa's rand recovered some of its footing against the dollar on Friday after sharp losses overnight, although the labour unrest still playing out in the platinum sector is likely to cap any significant gains.

The market has cut back expectations for an interest rate increase when the central bank holds its policy meeting next week, after a recent slew of weak manufacturing, mining and retail sales data pointed to an economy under strain.

The rand traded at 10.3510 to the greenback by 18:12 SA time, up 0.51 percent from where it closed the New York session on Thursday.

The rand had fallen more than 1.3 percent the previous day in a global emerging market sell-off and as investors fretted about the impact on the domestic economy of a platinum sector wage strike which has lasted more than 16 weeks.

“The rand seems to be finding support at 10.4000 but could take another stab at those levels next week,” a trader in Johannesburg said.

“If the central bank keeps rates unchanged that could be slightly rand negative, and the mine labour situation is not helping sentiment,” he added.

Government bonds extended Thursday's losses, with the yield on the 2026 bond adding 6 basis points to 8.125 percent while the 2015 paper climbed 7 basis points to 6.615 percent. - Reuters

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