South African rand extends gains as dollar slips
2024.07.05 05:27
JOHANNESBURG (Reuters) – extended its gains against a weaker dollar on Friday, fuelled by expectations that the Federal Reserve will cut interest rates later this year.
At 0823 GMT, the rand traded at 18.1975 against the dollar, 0.4% stronger than its previous close.
The was last trading down 0.17% against a basket of currencies, after softer-than-expected U.S. economic data earlier in the week spurred hopes of an interest cut as early as September.
The rand, like most emerging market currencies, takes its cue from global drivers such as U.S. monetary policy in addition to local events.
“The rand is expected to closely follow the dollar as attention shifts away from government and cabinet news headlines,” said Andre Cilliers, currency strategist at TreasuryONE.
Ministers in the new South African government were sworn in on Wednesday after a historic election in May, which saw the African National Congress lose its majority for the first time since the end of apartheid 30 years ago.
On the stock market, both the Top-40 index and the broader all-share index were down around 0.1% in early trade.
South Africa’s benchmark 2030 government bond was stronger, with the yield down 4.5 basis points to 9.74%.
