South Africa's rand weakens on risk aversion

22 Jan, 2019

At 0720 GMT, the rand was 0.63 percent weaker at 13.92 versus the dollar, compared with a close of 13.8325 in New York.

Government bonds were also weak, with the yield on the benchmark 2026, instrument up 1 basis point at 8.910 percent.

The dollar hovered near 2-week highs on Tuesday as a slowdown in China's economy to 28-year lows fanned fresh worries over global growth and prompted investors to move into safe-haven currencies.

The International Monetary Fund on Monday cut its world economic growth forecasts for 2019, and 2020, citing weakness in Europe and some emerging markets, and warned that failure to resolve the Sino-US trade dispute could further destabilise a slowing global economy.

"Worldwide growth concerns have emerged as the number one factor market participants are presently focusing on, after the IMF cut its global growth forecasts for 2019 and 2020 on Monday," Peregrine Treasury Solutions corporate treasury Manager, Bianca Botes said in a note.

Copyright Reuters, 2019

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