South Africa’s rand weakened against the dollar on Wednesday in what could be a negative trend for the currency going into 2015 after stronger-than-expected economic growth in the United States buoyed an already bullish dollar.
The world’s number one economy grew at 5 percent in the third quarter, its quickest pace in 11 years, pushing the dollar index to eight-year highs while struggling emerging market currencies braced for additional sell-offs.
By 0623 GMT the rand had softened 0.07 percent to 11.6580 per dollar, with a further slide on the horizon, as structural weaknesses in the domestic economy and falling commodity prices globally maintain pressure on the local unit.
The rand has already shed close to 25 percent against the greenback in 2014 as labour disruptions, chronic power cuts and yawning budget and current account deficits put off investors already spooked by weaknesses across developing economies.
Yields on local bonds were flat in early trade, with the benchmark issue due in 2026 unmoved at 8.055 percent.Next Tuesday South Africa publishes November trade data, currently gaping at a 21 billion rand […]