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South Africa’s rand weaker in early trade

PUBLISHED: Tue, 30 Mar 2021 07:57:30 GMT

JOHANNESBURG, March 30 (Reuters) – South Africa’s rand inched lower in early trade, having made gains in the previous session, as investors awaited key data later in the week.

At 0740 GMT the rand was 0.17% weaker at 14.9550 per dollar, compared with an overnight close of 14.9300. “Feb trade balance stats, due tomorrow, are expected to show net cross-border trade flows remain positive as local import demand has yet to recover from last year’s shock,” said economists at ETM Analytics in a note.

“Meanwhile, Feb monthly budget data, out later today, will once again reflect the fiscal slippage that remains the main structural risk to SA’s economy and the ZAR.”

High-yielding currencies in the developing world have come under pressure this month from rising U.S. bond yields, which have surged on expectations of higher inflation and have pushed up demand for the dollar.

The dollar climbed on Tuesday as Treasury yields spiked again, with accelerating vaccinations and massive stimulus in the United States stoking inflation concerns.

Bonds were also weaker, with the yield on the benchmark 2030 paper up 9 basis points to 9.54%. (Reporting by Mfuneko Toyana; Editing by Alex Richardson)

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