South African rand moves lower at end of volatile week

PUBLISHED: Fri, 15 Jan 2021 07:10:51 GMT

JOHANNESBURG, Jan 15 (Reuters) – South Africa’s rand weakened early on Friday, in line with other emerging market currencies, as the dollar firmed on global markets.

At 0702 GMT, the rand traded at 15.1650 versus the dollar, down roughly 0.5% on its previous close.

The rand has had a volatile week, falling one day before firming the next.

It has mainly taken its cue from global factors, shrugging off poor local manufacturing data that showed the sector was still stuck in a rut in November.

Comments by President Cyril Ramaphosa in an address to the nation on Monday that the country had secured more COVID-19 vaccines lifted the market’s mood temporarily, but details as to when the vaccines would arrive and who would supply them are still scarce.

Next week, attention will turn to the South African Reserve Bank’s first monetary policy meeting of 2021. Most analysts polled by Reuters predict the bank will keep its main lending rate on hold at 3.5%, but a small minority have pencilled in a rate cut.

Another cut could hurt the rand by making investing in local assets less attractive.

Government bonds were broadly flat in early deals, with the yield on the benchmark 2030 instrument at 8.765%. (Reporting by Alexander Winning. Editing by Mark Potter)

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