Rand weakens after reserves

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NewRandMoney Reuters.

Johannesburg - South Africa's rand hovered close to the previous day's 4-1/2 week trough against the dollar on Thursday, weighed down by risk aversion over the political crisis in Ukraine and lingering worries about domestic growth prospects.

The rand retreated about three cents after the Reserve Bank said net gold and foreign exchange reserves dipped to $44.315 billion in July from $44.828 billion in June.

By 08:55 SA time the rand was trading 0.5 percent softer at 10.7600 versus the dollar, compared with its closing level on Wednesday.

The local unit had slumped to 10.8225 the day before, a level it last touched in early July, as economic sanctions against Russia over its role in the Ukraine crisis weighed on appetite for high-yielding but riskier emerging markets.

Currency markets were likely to be nervous ahead of policy statements from the Bank of England and the European Central Bank, traders and analysts said.

Government bonds weakened alongside the rand, with the yield for the benchmark 2026 instrument edging 2 basis points higher to 8.335 percent while the 2015 paper ticked up 1.5 basis points to 6.67 percent. - Reuters

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