JOHANNESBURG: The South African rand fell against the dollar on Friday, hitting its weakest level in a month, after central bank data showed a wider-than-expected trade deficit.
South Africa's deficit widened to 13.03 billion rand ($1.3 billion) in April from 11.39 billion rand in March.
The rand was down 1.6 percent to 10.58 against the dollar at 1606GMT, after earlier hitting 10.5935 - its weakest since late April.
Emerging markets struggled across the board, with the rand the weakest in a basket of emerging market currencies tracked by Reuters.
"Today the rand was under-performing. It is certainly the lowest performer of the day and that's due to the trade data," said a Johannesburg trader, adding that the currency could be weaker in the coming week.
Reserve Bank data out today also showed growth in credit demand from South Africa's private sector had slowed, from 8.73 percent in March to 8.27 percent in April.
The wider trade deficit, combined with the on-going strike in South Africa's platinum sector now in its 19th week, signaled continued pressure on South Africa's current account and a fragile economy overall.
Government bonds tracked the weaker rand with yields on both benchmark issues edging higher.
The paper maturing in 2026 added 13 basis points to 8.31 percent, while the shorter benchmark paper maturing in 2015 gained 9.5 basis points to 6.66 percent.
Comments
Comments are closed.