The South African (SA) Rand slipped in early trade on Thursday, tracking most emerging market assets ahead of the release of a local Purchasing Managers’ Index (PMI) and November production figures for the manufacturing sector.
Rand traded at 16.4875 against the Dollar, down about 0.3% after a 0.5% decline on Wednesday as markets weighed up intensifying geopolitical tensions and United States data for clues on future monetary policy.
“Many in the market have turned their focus to valuations, which they felt were unsustainable,” ETM Analytics said in a note.
SA’s bank Absa PMI survey is set to be released and will shed light on manufacturing conditions in Africa’s most industrialised economy.
SA’s statistics agency will publish manufacturing output, with analysts polled by Reuters expecting a 0.2% rise.
Central bank data earlier showed that the country’s net foreign reserves rose to $71.14 billion at the end of December from $70.02 billion in November.
While the Rand has lost some ground, sentiment towards SA continues to be positive, which should ensure that it remains on the firmer side, said TreasuryONE currency Strategist Andre Cilliers.
SA’s benchmark 2035 government bond was weaker in early deals, with the yield rising by 2.5 basis points to 8.315%.
–Reuters–
