JOHANNESBURG (Reuters) – The South African rand fell on Monday as global markets were in a cautious mood after a mixed U.S. jobs report and ahead of U.S. and Chinese inflation figures later this week.
At 1502 GMT, the rand traded at 18.7150 against the dollar, about 1.41% weaker than its closing level on Friday.
The dollar was last up 0.05% at 102.13 against a basket of global currencies.
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Casey Delport, an investment analyst at Anchor Capital, said it was difficult to pinpoint exactly what had caused markets to shift to a risk-off footing, but while that persisted the rand would be on the defensive.
She said one factor was recent U.S. economic data which had made some traders speculate that the Federal Reserve will raise interest rates again in September.
A major focus for markets this week will be inflation data out of China, Germany and the United States.
“This data can recalibrate the market’s outlook on monetary policy once again, which will feed directly into currency prices, thus a cautious start to the week is envisaged,” Rand Merchant Bank analysts said in a research note.
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Adding to downward pressure on South Africa’s economic growth and contributing to rand volatility is the country’s issue of poor power generation and logistics, among others, said Citibank analysts in a research note.
Central bank data on Monday showed the country’s net foreign reserves rose in July to $55.626 billion from $54.936 billion in June.
The Johannesburg Stock Exchange’s blue-chip Top 40 index was little changed at the end of the day. South Africa’s benchmark 2030 government bond was marginally stronger, with the yield down 1.5 basis points to 10.245%
