File Image: IOL

JOHANNESBURG - The rand eased yesterday to three-week lows after data showed the current account deficit widened in the second quarter, while mining shares weighed on the bourse.

The current account deficit widened to the equivalent of 2.4% of gross domestic product as an increased trade surplus was offset by a larger shortfall on services, income and current transfer payments, a bigger shortfall than the 2%  expected by economists.

However, at 5pm, the rand was bid at R13.1635 to the dollar, less than one cent firmer than at the same time on Wednesday.

Some relief for the rand could come from a surplus in the trade account, Kevin Lings, chief economist at Stanlib, said in a note.

“As always, however, domestic political risks intertwined with the ongoing risk of further credit rating downgrades coupled with changes in global risk appetite are likely to keep the Rand volatile over the short to medium term,” he said.

In fixed income, the yield for the benchmark government due in 2026 was lower.

Stocks also eased, with Impala Platinum sliding 6.48% to close at R36.80 after it reported a 2017 loss after writing off part of the value of a deal a decade ago that helped the miner meet a target for black ownership.

The benchmark JSE Top40 index was off 0.54% at 49514.83 points and the broader all share index dropped by the same margin to 55850.32 points.

PPC bucked the downward trend, closing 4.7% higher at R6.24 after Nigeria’s Dangote Cement said it was in preliminary talks with the cement producer about a takeover offer.

-BUSINESS REPORT