Rand vulnerable to more strikes

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NewRandMoney

Reuters.

Johannesburg - South Africa's rand weakened slightly against the dollar on Tuesday, with scope to extend losses as the country's largest labour union enters the third week of a wage strike that has hit the operations of major auto makers.

At 08:46 SA time the rand was trading at 10.7050/dollar, down 0.28 percent from its previous close.

In fixed income, the yield for the 2026 benchmark added 1 basis point to 8.335 percent while the 2015 paper at the short end of the curve was flat at 6.67 percent.

Leaders of the National Union of Metalworkers of South Africa are expected to draw up plans on widening a strike that has dealt another blow to an economy still counting the cost of a five-month platinum sector stoppage at the start of the year.

“While strikes are very familiar to investors, they nonetheless have a dampening effect on confidence,” Rand Merchant Bank analyst Mamello Matikinca said in a note.

“South Africa will struggle with narrowing its current account deficit as import growth remains strong.” - Reuters


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