Rand slides further on strong US data

THE RAND notched its third straight daily loss against the dollar yesterday, hitting oneandweek lows as investors gravitated towards the greenback after US gross domestic product (GDP) data came out stronger than it was forecast.

The rand slumped to a session trough of R10.6920, its weakest since July 18. At 5pm, the rand was bid at R10.6873 to the dollar, 10.86c softer than at the same time on Tuesday.

“It’s all about a stronger dollar globally after the US GDP; the domestic news flow has taken a back seat today [yesterday],” a trader with a Johannesburg investment bank said.

The dollar hit over 10-month highs against a basket of major currencies after the GDP data, which bolstered expectations for a more hawkish Federal Reserve statement later yesterday.

Government bonds weakened alongside the rand, pushing yields to their highest levels in more than two weeks.

The 2026 instrument, which the secondary market uses as a benchmark and the shorterdated 2015 paper, both rose.

The rand has weakened more than 2 percent against the dollar since the start of the year. Meanwhile, the Nigerian naira closed unchanged against the dollar on the interbank market yesterday, after two days public holiday to mark a Muslim festival, supported by dollar sales by two major energy companies.