South Africa’s rand eases as dollar regains footing
JOHANNESBURG (Reuters) – South Africa’s rand eased early on Friday as the dollar, which has been a safe haven amid global uncertainty over trade, touched 112.775 against the yen, its highest level in six months, boosted by expectations of higher U.S. inflation.
South African Rand coins are seen in this photo illustration taken September 9, 2015. REUTERS/Mike Hutchings
At 0750 GMT the rand was 0.32 percent softer at 13.3400 per dollar, after rallying more than 2 percent in the previous session, a chunk of those gains seen late in local trading after manufacturing figures for May came in better-than-expected.
May manufacturing output expanded 2.3 percent year-on-year in May and was up 1.5 percent on a monthly basis. On a quarterly basis however output shrunk, raising fears about second quarter economic growth after a first quarter contraction.
Technical plays could provide support after the rand hurdled resistance at 13.50 and 13.30 to lure back investors with long dollar positions.
News late on Thursday that Saudi Crown Prince Mohammed bin Salman pledged to invest $10 billion in building refineries, petrochemicals and renewable energy, during an official visit by President Cyril Ramaphosa, also boosted sentiment.
Bonds were slightly firmer with the yield on the benchmark bond due in 2026 down two basis points at 8.705 percent.
The Johannesburg Stock Exchange’s Top-40 index was 0.1 percent lower at 50,620.
Reporting by Mfuneko Toyana; Editing by Ed Stoddard
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