UPDATE 1-South African rand hits new high as manufacturing outperforms

  • Reuters
  • Forex News
UPDATE 1-South African rand hits new high as manufacturing outperforms
Credit: © Reuters.

(Updates to reflect afternoon trade)

JOHANNESBURG, May 11 (Reuters) - South Africa's rand touched a 16-month high against the dollar on Tuesday afternoon, helped by manufacturing figures that were far stronger than expected.

At 1555 GMT, the rand ZAR=D3 was at 13.9825 against the dollar, 0.25% stronger than its previous close.

The rand moved below 14 to the dollar for the first time since early January 2020 on Monday and posted further gains on Tuesday.

Factors driving it higher include strong prices for metals the country exports, expectations that U.S. interest rates will not rise any time soon and signs that reform-minded President Cyril Ramaphosa is asserting his authority in the governing party.

Manufacturing output rose 4.6% year on year in March, data showed on Tuesday, outperforming the 0.45% increase forecast in a Reuters poll. bonds firmed slightly, with the yield on the 2030 instrument ZAR2030= dipping 2 basis points to 8.96%.

But the Johannesburg Stock Exchange posted its biggest daily percentage fall in three weeks, with some investors concerned about rising U.S. Treasury yields.

The all-share index .JALSH shed 1.66% to 67,241 points and the blue-chip index .JTOPI fell 1.71% to 61,320.

"If U.S. risk-free government bonds slowly reach 2% then why would you go to emerging market stocks and take all the risk? ...it is this sort of fear that occasionally grips the market," said Greg Davies, a trader at Cratos Capital.

Banks fell less than most, with the banking index .JBANK down 0.4%. Mining .JMINI and industrials .JINDI fell 2.6% and 1.7%, respectively.

Drop an image here or Supported formats: *.jpg, *.png, *.gif up to 5mb

Error: File type not supported

Drop an image here or

100
  • Gosball gosball @Gosball gosball
    Lack of supply pushing prices/ inflation higher. Rates will be increasing.
    Like 0
  • Thilivhali Romeo @Thilivhali Romeo
    high inflation rate
    Like 0
  • Prince Thato @Prince Thato
    But the price of petrol is still higher 👆
    Like 0
    • Njabulo Jiki @Njabulo Jiki
      I think the formular used to workout the retail price for fuel in RSA is outdated. It has proven to be counter intuitive on many ocassoons. Check how much you pay per litre of fuel in Botswana and how much you pay in RSA. I bet you fuel in Botswana is cheaper, why? Even if you convert the fuel price in Pula to ZAR its still cheaper but we have a bigger buying power than then volume wise on fuel.....
      Like 0
    • Xavier Mateman @Xavier Mateman
      keep in mind that inland and coastal prices may differ and our taxes on fuel is ridiculous.. The production line of our fuel I think also responds with lag to changes between the Rand and dollar
      Like 1
    • Drop an image here or Supported formats: *.jpg, *.png, *.gif up to 5mb

      Error: File type not supported

      Drop an image here or

      100