South Africa’s (SA) Rand weakened on Friday, pressured by an overnight drop in commodity prices after strong United States labour data dampened speculation of near-term Federal Reserve rate cuts.
The Rand traded at 16.0150 against the Dollar, down roughly 0.4% from Thursday’s close.
“Yesterday’s retreat in commodities such as Gold, Silver, and Platinum appears to be the primary driver of this move, with the Dollar continuing to trade in a tight range and offering little directional momentum,” said ETM Analytics in a research note.
SA’s key exports, gold and platinum , attempted a recovery in Friday’s early session, gaining 0.6% and 0.9%, respectively.
“Lending the rand some support is the modest recovery in these markets this morning, which implies that any depreciation in the currency will likely be limited,” said ETM Analytics.
President Cyril Ramaphosa, in his annual address to parliament on Thursday, pledged to deploy the army to combat organised crime and file charges against municipal officials who fail to deliver water to communities.
ETM Analytics said the positive reception to Ramaphosa’s remarks could bolster sentiment towards the rand.
On the Johannesburg Stock Exchange, the Top 40 index fell 1.2% in early trade.
SA’s benchmark 2035 government bond also weakened, with the yield up 5 basis points to 8.01%.
–Reuters–
