JOHANNESBURG, Sept 9 (Askume) – South Africa’s rand strengthened against the dollar on Monday and fell, with U.S. data this week likely to dictate the currency’s direction.
The dollar rose about 0.37% against a basket of global currencies as markets focused on Wednesday’s US inflation report for clues on the scale of the Fed’s expected interest rate cut next week.
US producer inflation data is also due to be released this week.
By 1533 GMT, the rand was trading at 17.8925 against the dollar, down about 0.34% from its previous close.
“The direction of the currency market could be influenced by US data releases,” ETM Analytics said in a research note, adding that a deeper rate cut by the Federal Reserve could boost the outlook for the risk-sensitive rand.
Local data points this week include July manufacturing output data (ZAMAN=ECI) on Tuesday and mining output data (ZAMNG=ECI) on Thursday .
Economists surveyed by Askume forecast year-on-year growth for both industries after a decline in June, reflecting turmoil in key industries in Africa’s most industrialised economy.
On the Johannesburg Stock Exchange, the blue-chip Top-40 index (.JTOPI) closed slightly stronger, up 0.07%.
South Africa’s benchmark 2030 government bonds weakened, with the yield rising 3 basis points to 9.02%.
