Rand weak­ens ahead of in­fla­tion data

The Star Early Edition - - MARKETS - Reuters

THE RAND weak­ened against the dol­lar yes­ter­day as mar­kets braced for con­sumer in­fla­tion num­bers and an in­ter­est rate decision by the cen­tral bank this week.

How­ever, at 5pm the rand was bid at R11.1199 to the dol­lar, 6.71c firmer than at the same time on Fri­day.

Com­mod­ity prices hurt emerg­ing mar­kets across the board as oil and gold fell, drag­ging emerg­ing mar­kets cur­ren­cies lower and stok­ing wor­ries that de­vel­op­ing economies could re­turn to the pre-fi­nan­cial cri­sis dilemma of low growth and high in­ter­est rates.

The Re­serve Bank an­nounces its fi­nal in­ter­est rate decision of the year on Thurs­day, with a nar­row majority of an­a­lysts in a Reuters poll pre­dict­ing that the bank will keep rates at 5.75 per­cent.

To­mor­row Statis­tics SA will re­lease the Oc­to­ber in­fla­tion data, which at the cur­rent 5.9 per­cent level sits just be­low the ceil­ing of the cen­tral bank’s tar­get range.

Gov­ern­ment bonds firmed, with the yield on the bench­mark pa­per due in 2026 drop- ping to a near 11-month low.

Mean­while, Nige­ria’s naira closed at a new low of 173.20 against the dol­lar yes­ter­day, down 1.21 per­cent in volatile trades, de­spite cen­tral bank in­ter­ven­tion to prop up the cur­rency, deal­ers said.

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