2023-08-14 06:54:30
The South African rand was under pressure in early trading on Monday, hampered earlier in the week by concerns over the health of the Chinese economy and the possibility of another US interest rate hike.
At 0635 GMT, the rand was at 19.01 to the dollar, around 0.2% lower than its closing level on Friday.
Rand Merchant Bank said in an early morning briefing that the rand was likely to fall further, citing weak economic data from China and no signs of stimulus, coupled with higher-than-expected core inflation in the United States and increased bets on another interest rate hike from the Federal Reserve in September.
ETM Analytics played down the market’s upside potential in this week’s South African data, which includes second-quarter unemployment data on Tuesday and June retail sales on Wednesday.
“The South African economy remains under considerable pressure and still carries a high risk premium that needs to be taken into account. As US bond yields rise, the rand will remain vulnerable,” the agency said in a note. research, adding that this week’s U.S. releases, including Federal Reserve minutes, are likely to further influence the market.
South Africa’s benchmark 2030 government bond was lower in early trades, with the yield rising 4.5 basis points to 10.210%.
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