The South African rand weakened sharply against a stronger dollar on Friday as traders assessed a series of monthly economic releases from the central bank, the revenue service agency and the National Treasury.
According to Reuters, at 1408 GMT, the rand was trading at 15.9850 to the dollar, about 1.5% weaker than Thursday’s close.
The dollar rose 0.5% against a basket of currencies, while gold prices fell by more than 4% following U.S. President Donald Trump’s selection of a new chair of the Federal Reserve.
Trump nominated former Federal Reserve Governor Kevin Warsh to lead the U.S. central bank when Jerome Powell’s term ends in May.
As a risk-sensitive currency, the rand is often influenced by global factors such as U.S. policy decisions, alongside domestic developments.
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Figures released by the South African Reserve Bank showed that M3 money supply growth slowed to 8.16% last month from 8.26% in November.
Meanwhile, private sector credit growth rose to 8.74% in December, significantly higher than November’s 7.79% and above the 7.60% forecast in a Reuters poll.
The National Treasury later published budget balance data indicating that South Africa recorded a budget surplus of 38.44 billion rand ($2.40 billion) in December.
Separately, data from the country’s revenue service agency showed a trade surplus of 23.18 billion rand for the same month, slightly below the 24.10 billion rand surplus expected by analysts surveyed by Reuters.
On the Johannesburg Stock Exchange, the Top-40 index was last down 4.1%. South Africa’s benchmark 2035 government bond also weakened, with yields rising 9.5 basis points to 8.06%.
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Image Credit: CNBC Africa
