South Africa's rand was flat against the dollar on Monday, remaining in touching distance of its weakest level in a week as sentiment towards emerging markets ebbed. By 1520 GMT the rand inched 0.02 percent weaker to 12.0575 per dollar, as poor local economic indicators compounded offshore risk factors and threatened to force the unit toward the crucial 12.10 technical mark.
New vehicle sales for April fell 3.3 percent to their lowest in over 10 months, according to the government trade authority, as South Africa's growth prospects continued to falter and pressure the rand. The dollar notched-up its second straight day of gains following a two-week decline on the back of positive economic data, again stoking bets of a US interest rate hike by the end of the year that is set to draw away funds from emerging markets, analyst Ricardo Da Camara said.
"Local fundamentals haven't been helping the rand either, making it more vulnerable than its EM peers," Da Camara, of research house ETM Analytics, added. Yields on government rose sharply on the day, with the benchmark instrument due in 2026 adding 9.5 basis to 8.05 percent, its highest in close to two weeks.
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