Rand retreats ahead of rates decision

THE RAND weakened to a fiveweek low against the dollar yesterday before the central bank’s interest rate decision this week and the US Federal Reserve’s policy meeting.

At 5pm, the rand was bid at R13.331 to the dollar, 4.12c softer than at the same time on Monday, its weakest since August 15.

The currency is facing selling pressure caused in part by bets on a hawkish Fed, local political fears and signs of a slower recovery of economic growth.

The SA central bank is likely to lower its key rate to 6.5 percent tomorrow, according to 17 out of 26 economists polled by Reuters

In fixed income, yields on the benchmark government bond due in 2026 dropped.

Meanwhile, stocks were mixed yesterday.

The benchmark JSE Top40 index was up 0.03 percent at 49 751.7 points. The broader all share index declined 0.07 percent to 56 011.16 points.

Shares of mining company Sibanye Gold plummeted after announcing it would issue convertible bonds worth $450 million (R5.9 billion) to refinance a loan partly used to fund its acquisition of US-based Stillwater last year.

Shares in Sibanye, which mines gold and platinum, tumbled to a seven-week low of R15.70, before recovering to R16.43, down 6.22 percent in the session.

Private education group Curro Holdings was among the gainers after it briefed investors yesterday on plans announced on Friday to spin off its tertiary education unit and list it separately.

Curro shares gained 2.03 percent to close at R36.20. MTN rose 1.4 percent to R122.52,

while Vodacom was down 1.57 percent at R158.50.