The rand edged lower in early trade on Wednesday, after tumbling as much as 2% on Tuesday, as risk-off sentiment increased on concerns about global economic growth and a credit rating agency downgraded the US.
At 0614 GMT, the rand traded at R18.34 against the dollar, about 0.2% weaker than its previous close.
The dollar last traded at 102.20, around 0.2% stronger against a basket of global currencies, recovering some losses it incurred after rating agency Fitch in a surprise move downgraded the US to AA+ from AAA.
Economic data this week showed manufacturing activity contracted in the US, Germany and China and other nations.
“All (emerging market) currencies came under pressure as global growth concerns resurfaced after a raft of manufacturing PMI numbers around the globe all printed below the 50.0 mark,” said Andre Cilliers, Currency Strategist at TreasuryONE.
“The rand has lost ground this morning as the cut in US credit ratings will spur the market to risk-off.”
South Africa’s benchmark 2030 government bond was also marginally weaker in early deals, with the yield up 2.5 basis points to 10.355%.
