South Africa’s (SA) Rand and government bonds started the week on the back foot ahead of the release of domestic inflation data, as reports that the Strait of Hormuz had again been closed sent oil prices higher and weighed on appetite for risk assets.
At 08:39 CAT the Rand traded at 16.4050 against the Dollar , 0.6% weaker than its previous close.
Oil prices jumped more than 5% this Monday, on fears that the ceasefire between the United States (US) and Iran could collapse after the US seized an Iranian cargo ship, while traffic through the Strait of Hormuz stayed largely halted.
Statistics SA will release March inflation data on Wednesday, with analysts polled by Reuters expecting it to inch up to 3.1% year-on-year from 3.0% in February.
As a net fuel importer, SA is heavily exposed to the spike in global energy prices.
Its currency has been at the mercy of global market sentiment since the US and Israel started the war at the end of February and Iran retaliated.
The SA Reserve Bank will publish a Monetary Policy Review document on Tuesday, which could shed light on its rate-setting trajectory this year.
SA’s benchmark 2035 government bond was flat in early deals, with the yield at 8.195%.
–Reuters–
