JOHANNESBURG: South Africa's rand inched lower against the dollar on Friday for a second straight session as hopes of an end to a strike in the metals and engineering sector were dashed.
Strike leader NUMSA rejected employers' latest offer of a 10 percent wage increase on behalf of over 200,000 workers, union sources said, sending the stoppage into its second full week.
At 1426 GMT, the local unit had fallen by 0.3 percent to 10.7235 rand per dollar, remaining within a range that saw it touch the 10.80 level only once this week.
The currency has been under pressure this year from almost non-stop labour unrest which has hit major industries, including a 5-month stoppage in the platinum sector.
The strikes have hit growth, pushing the economy into contraction in the first quarter of the year, although the central bank has been forced into a tightening cycle by inflation rising outside its 3-6 percent target band. A Reuters poll indicated the Reserve Bank was likely to hold interest rates at 5.5 percent next Thursday, balancing price pressures against the need to continue to help the flagging economy.
The next rate hike is expected in September. Government bonds edged weaker, with the yield on the paper due in 2015 adding 1 basis point to 6.7 percent, while the longer-dated bond due in 2026 added 3 basis points to 8.355 percent.
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