The rand was under pressure in early trade on Monday, hampered at the start of the week by worries over the health of China’s economy and the potential for another US interest rate hike.
At 0635 GMT, the rand was at R19.01 to the dollar.
Rand Merchant Bank said in a morning briefing that the risks were for the rand to fall further, citing weak economic data out of China and no signs of stimulus, coupled with higher-than-expected core producer inflation in the US and increased bets on another Federal Reserve rate hike in September.
ETM Analytics played down the market-moving potential of this week’s South African data releases, which include second-quarter unemployment data on Tuesday and June retail sales on Wednesday.
“South Africa’s economy remains under considerable pressure and still holds a high-risk premium which must be accounted for. As US bond yields rise, the rand will remain vulnerable,” it said in a research note, adding that this week’s US releases, including Federal Reserve minutes, were likely to be more market-moving.
South Africa’s benchmark 2030 government bond was weaker in early deals, the yield up 4.5 basis points to 10.210%.
