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Rand falls amid stronger dollar

At 0645 GMT, the rand traded at 16.0375 against the dollar, 0.34% weaker than its close on Thursday, when it slumped by close to 4%. Picture: Mike Hutchings, Reuters.

At 0645 GMT, the rand traded at 16.0375 against the dollar, 0.34% weaker than its close on Thursday, when it slumped by close to 4%. Picture: Mike Hutchings, Reuters.

Published May 6, 2022

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South Africa's rand continued to trade weaker against the dollar early on Friday, as the greenback firmed ahead of a closely watched US jobs report that is likely to back the case for aggressive monetary policy tightening in the United States.

At 0645 GMT, the rand traded at 16.0375 against the dollar, 0.34% weaker than its close on Thursday, when it slumped by close to 4%.

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The dollar was headed for a fifth winning week as benchmark US Treasury yields held near their highest levels since November 2018.(FRX/)

"The foreign exchange markets have, over the course of the week thus far, experienced extreme price action and change. This scenario is exacerbated by an apparent lack of liquidity," Nedbank analysts wrote in a note.

"Today, the markets are likely to remain extremely cautious ahead of the US data release this afternoon."

Investors now eye US non-farm payroll data for April to assess its impact on monetary policy. The Fed on Wednesday raised its benchmark rate by half a percentage point, the most in 22 years.

Government bonds also weakened, with the yield on the benchmark instrument maturing in 2030 up 6 basis points to 10.045%.

REUTERS

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