The South African (SA) Rand was little changed early on Thursday as investors awaited domestic mining production data and lower-than-expected United States (US) inflation figures tempered expectations that the Federal Reserve will raise interest rates next month.
The Rand traded at 16.1625 against the Dollar, almost unchanged from its previous close.
Statistics SA is due to publish June mining production data, providing insights into the health of Africa’s largest economy.
Mining output fell by 5.4% year-on-year in May and economists expect it to fall again in June.
“For mining, weaker output is likely to reflect elevated input costs and softer commodity prices in some key segments. Although fuel costs moderated in June, they remained significantly higher than a year ago,” said Nedbank economists in a note.
Like other risk-sensitive currencies, the rand often takes its cues from global factors, particularly US monetary policy, alongside domestic economic data.
The US Consumer Price Index rose 0.1% in July, a modest increase that could weaken the case for a Federal Reserve interest rate hike next month, lifting risk appetite.
On the Johannesburg Stock Exchange, the Top 40 index was last down 0.9% in early trade.
SA’s benchmark 2035 government bond was weaker in early deals, as the yield rose 12 basis points to 8.425%.
–Reuters–
