JOHANNESBURG - The Rand weakened yesterday as the currency along with fellow emerging markets strained under pressure from a stronger dollar and a dim local economic outlook.
At 5pm, the rand had slid to R13.6483 to the dollar from a close of R13.56 on Friday in New York.
The dollar index was up 0.6percent near a two-month best. Before recovering slightly, the rand slipped to a session low of R13.66 toward last Thursday’s five-month low as the dollar solidified its recent rally after strong manufacturing figures there boosted bets of higher interest rate and higher yields for investors.
Data on Friday showing the SA government recorded a R13billion budget deficit in August following a R92bn shortfall in July stoked fears the country may not avoid deeper credit downgrades, weighing on demand for the rand. Bonds were also under pressure with the yield on the benchmark paper due in 2026 up 5.5 basis points to 8.615percent.
On the bourse, stocks ended slightly higher with Naspers adding the most points to the index after brokers at UBS raised their price target on the e-commerce giant’s stock. Naspers, Africa’s biggest firm by value, advanced 1.82percent to R2973. UBS raised its price target on the stock to R4644.
Overall, the benchmark JSE Top40 index was up 0.47percent at 49609.58 points and the broader all share index gained 0.36percent at 55778.27 points.
Meanwhile, all the three major US stock indexes were hovering near record highs yesterday morning, in a strong start to the fourth quarter, boosted by technology and healthcare stocks and after data pointed to underlying strength in the economy.