South Africa's rand rose on Wednesday as investors looked to possible monetary easing steps at upcoming European and US central bank meetings. At 1600 GMT the rand was 0.5% firmer at 13.8575 per dollar, reversing the previous session's modest slide. The prospect of lower interest rates in major developed economies stimulates appetite for riskier assets, such as those in emerging markets.
The Top-40 Index closed down 1.12% at 51,626 points, while the broader All-Share Index dropped 1.01% to 57,718 points. South African government bonds also fell, with the yield on the benchmark 2026 bond up 2.5 basis points to 8.095%. Weak economic data bolstered speculation the European Central Bank could undertake aggressive monetary policy easing as soon as this week.
The South African Reserve Bank tempered expectations for more interest rate cuts at its monetary policy meeting last week. On the Johannesburg Stock Exchange, local stocks fell, partly hit by fiscal worries after Finance Minister Tito Mboweni said on Tuesday in parliament that key state-owned companies would need more financial support.
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