JOHANNESBURG: South Africa’s rand gained on Wednesday as the dollar was shaken by market uncertainty around U.S. tariffs and local investors awaited news on the future of the coalition government.
At 0757 GMT, the rand traded at 18.9425 against the U.S. dollar, about 0.4% stronger than its previous close.
The dollar last traded about 0.7% weaker against a basket of currencies.
U.S. President Donald Trump’s tariffs have escalated tensions between the U.S. and China, South Africa’s biggest trading partner, driving uncertainty and hurting the greenback over recent weeks.
“There has been little change on the tariff front overnight, but the trade war between the US and China continues to escalate,” said Andre Cilliers, currency strategist at TreasuryONE.
Domestic-focused investors will look to South Africa’s business confidence index for March at 0930 GMT and retail sales data for February at 1100 GMT, in addition to developments over the country’s budget impasse.
South Africa’s rand recovery continues with volatile global and local backdrop
The two biggest parties in South Africa’s government of national unity (GNU) have been at odds over a proposed value-added tax hike on May 1.
“The ZAR’s near-term recovery has largely played out, but it could extend to any more positive news from the GNU regarding a budget most parties can support,” said ETM Analytics in a research note.
On the Johannesburg Stock Exchange, the blue-chip Top-40 index was little changed in early deals.
South Africa’s benchmark 2030 government bond was slightly firmer, with the yield down 1 basis points to 9.21%.
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