Rand weakens ahead of inflation data
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.