Rand softer as U.S. rates, trade war weighs

10 Sep, 2018 - 15:09 0 Views
Rand softer as U.S. rates, trade war weighs

eBusiness Weekly

JOHANNESBURG – South Africa’s rand kicked off Monday on the back foot against the dollar as concerns about higher lending rates in the United States and an escalation in a trade war between Washington and Beijing subdued demand for emerging market currencies.

* At 0615 GMT the rand was 0.13 percent weaker at 15.2600 per dollar compared to a close of 15.2400 on Friday in New York.

* Strong U.S. August jobs data lifted the greenback on Friday, while fears that the trade battle between the United States and China would strangle a rebound in global growth kept investors cool on emerging market assets.

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* U.S. President Donald Trump said on Friday he was ready to slap tariffs on virtually all Chinese imports, threatening duties on another $267 billion of goods in addition to the $200 billion already facing the risk of duties.

* The rand had staged a decent recovery late in the previous week after data showing South Africa’s current deficit narrowed to 3.3 percent of GDP in the second quarter from 4.6 percent, triggering some short-covering by traders ahead of the U.S. jobs data.

* Investors remain skittish on the rand though following second quarter gross domestic product data earlier last week showing the economy shrank 0.7 percent.

* Bonds were weaker, with the yield on the benchmark paper due in 2026 rising 7 basis points to 9.21 percent. – Reuters Africa

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