South African rand falls ahead of May inflation data

Login

Register

http://www.clubofmozambique.com/

South African rand falls ahead of May inflation data

9:42 CAT | 21 Jun 2023

File photo: Reuters

The South African rand fell in early trade on Wednesday, ahead of May inflation data that could give clues on the health of Africa’s most industrialised economy.

At 0605 GMT, the rand traded at 18.4075 against the U.S. dollar, around 0.14% weaker than its previous close.

Meanwhile, the dollar index was last at 102.620 – about 0.12% stronger.

“Rand gains have run out of steam and (dollar/rand exchange rate) is now consolidating,” said Rand Merchant Bank (RMB) analysts in a research note after the currency faced its first day of losses in almost two weeks on Tuesday.

Investors will now turn their attention to South Africa’s May consumer price index data, due at 0800 GMT .

Analysts polled by Reuters predict year-on-year inflation in May to sit at 6.5%, down from 6.8% registered in April.

With inflation data expected and a speech by U.S. Federal Reserve Chair Jerome Powell at 1900 GMT, “the risk bias is now arguable for rand losses,” RMB analysts added.

South Africa’s benchmark 2030 government bond was flat in early deals, with the yield at 10.830%

Source: Reuters