Cape Town - The rand weakened, maintaining the more than five-year low it hit earlier this month, before US jobs and inflation data that will help investors gauge the outlook for stimulus cuts.

South African bond yields rose to the highest in more than a month.

Initial jobless claims in the world’s biggest economy probably fell to the fewest since November in the week to January 11, while consumer inflation accelerated at the highest rate since August, reports may show today.

A New York manufacturing gauge increased more than economists expected in January, according to figures yesterday.

The data may bolster arguments for further tapering of Federal Reserve bond purchases that helped stimulate demand for South African assets.

The rand is weakening “into continued broad-based dollar strength” as the US economy shows signs of improvement, Bruce Donald, head foreign-exchange strategist at Standard Bank Group Ltd. in Johannesburg, said in an e-mail.

US data “confirmed the market’s expectation that tapering will continue in incremental steps of around $10 billion” a month, he said.

The rand slumped as much as 0.7 percent to 10.9520 per dollar, the weakest level since October 2008.

It traded 0.6 percent lower at 10.9493 per dollar by 10:03 a.m. in Johannesburg.

Yields on benchmark rand bonds due December 2026 climbed four basis points, or 0.04 percentage point, to 8.38 percent, the highest on a closing basis since December 6.

Foreign investors sold a net 394 million rand ($36 million) of South African debt yesterday, bringing outflows this year to 3.06 billion rand, according to JSE Ltd. data. - Bloomberg News