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Rand weaker as investors seek shelter in dollar

August trade numbers due on Monday.
The rand was at 15.18 per dollar in early trade. Image: Waldo Swiegers/Bloomberg

The rand weakened early on Monday as the dollar gained against riskier currencies, with investors watching developments in the China-US trade dispute and a slew of domestic and global economic indicators this week.

At 0610 GMT, the rand traded at 15.18 per dollar, 0.3% weaker than its close on Friday, when the currency fell to a session low of 15.19, its weakest since September 3.

Risk assets took a hit in US trade on Friday following news that President Donald Trump’s administration is considering radical new financial pressure tactics on Beijing, including the possibility of delisting Chinese companies from US stock exchanges.

“The pressure on emerging markets is mounting, as the US continues to make waves in the global market,” Bianca Botes, Treasury Partner at Peregrine Treasury Solutions, said in a note.

“Washington announced over the weekend that the US was investigating ways to limit its portfolio investment flows to China, although the US Treasury subsequently denied plans to block Chinese listings on US stock exchanges.”

On the data front, British economic growth and US manufacturing indicators are due later on Monday, with US employment figures set to be released at the end of the week.

Locally, markets will look to August trade balance numbers due at 1200 GMT.

In fixed income, the yield on the benchmark government bond due in 2026 added 4 basis points to 8.335%, reflecting weaker bond prices. 

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