JOHANNESBURG - The Rand weakened slightly on Friday as investors bagged profits from a rally that had set the local unit up for its longest weekly winning streak since 2002.
At 5pm, the rand bid at R12.3712 to the dollar, 5.68c softer than at the same time on Thursday, paring the week’s gains but still on course for its eighth consecutive week of advances.
The rand has been on the front foot since December, supported by investors’ hopes that the newly elected leader of the ANC, Cyril Ramaphosa, would push through business-friendly policies.
But there have been fears he could be hamstrung by divisions in the party; a Reuters poll of strategists published on Friday suggested the rand would weaken more than 12percent this year.
“I have belief in Cyril, but in the split of the top six ANC officials, I don’t know how much he can get done,” said Frank Blackmore, an economist at EFConsult.
On the bourse, investors took their cue from an upbeat tone in major emerging markets.
The blue chip JSE Top 40 index rose 0.34% to 52842.68 points and the broader all share index added 0.4% to 59717.2 points.
In fixed income, government bonds were weaker, with the yield on the government paper due in 2026 up 1.5 basis points to 8.555percent.
Meanwhile, data this week will enable investors to gauge the strength of German and British industry, US spending and Chinese trade at the end of last year - and the first hints on the strength of economic activity at the start of 2018.
The German economy has been firing on all cylinders in recent months, with consumption, state spending and rising exports driving growth in both industry and services.
With interest rates low and the labour market performing well, the economy has so far weathered the political impasse resulting from Chancellor Angela Merkel’s failure to form a government since an election in September. She was set to launch coalition talks yesterday with the Social Democrats, her partners from the 2013-17 administration.
Industrial orders have been strong in recent months, suggesting this sector of Europe’s biggest economy should gain steam at the start of the year.