South Africa's rand tumbled to a new six-month low on Monday as concerns over the economy following weekend power outages worsened the effects of a global selloff of emerging market currencies. Stocks were also down, led by banks and financials.
At 1550 GMT the rand was 2.08 percent weaker at 13.7150 per dollar, its weakest level since December 13, with most of the losses coming as trade began in New York.
The rand is down nearly 9 percent in June against a resurgent dollar, with disappointing economic data cooling enthusiasm under new President Cyril Ramaphosa. Africa's most industrialised economy suffered its worst quarterly GDP contraction in nine years in the first quarter, and last week embattled power utility Eskom began the first country-wide controlled power outages since 2015.
"The trade war between China and the US is keeping EMs on the defensive. The growth picture in S.A. isn't helping and Eskom is making things worse," said Halen Bothma of ETM Analytics. The United States on Friday slapped tariffs on $50 billion worth of Chinese goods, the latest salvo in a widening trade dispute between the world's biggest economies that has battered emerging markets currencies.
The rand breached the 200-week moving average on Friday with a close above 13.1975 to the dollar, while momentum indicators suggest further selling with the 14/$ a target for investors looking to short the currency.