Market News

South African rand weakens on bleak investor outlook - REUTERS

JUNE 07, 2023

JOHANNESBURG, June 7 (Reuters) - The South African rand weakened in early trade on Wednesday after investors warned that the outlook for Africa's most industrialised economy remained bleak despite marginal economic growth in the first quarter.

At 0606 GMT, the rand traded at 19.2700 against the dollar , around 0.42% weaker from its previous close.

The dollar was last trading at 104.150, around 0.067% stronger, against a basket of global currencies.

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The rand strengthened slightly on Monday after facing some headwinds and tepid investor sentiment, which pushed the unit as low as 19.9075 against the greenback last week.

"There are some notable (South Africa) positives to reference, but rand gains are nevertheless running out of steam," said Rand Merchant Bank analysts in a research note.

The country managed a 0.4% growth in gross domestic product for the first quarter and dodged a recession.

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Nonetheless, investor outlook remains bleak as the country's worst rolling blackouts on record show no signs of abating.

Investors will on Thursday turn their attention to the South African Reserve Bank when it releases the country's first-quarter current account figures (ZACACT=ECI), which could give an indication on the health of Africa's most industrialised economy.

South Africa's benchmark 2030 government bond was weaker in early deals, with the yield up 1.5 basis points at 10.980%.

Reporting by Tannur Anders; Editing by Sherry Jacob-Phillips


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