UPDATE 1-South Africa's rand inches lower in cautious trade, shares down

  • Reuters
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UPDATE 1-South Africa's rand inches lower in cautious trade, shares down
Credit: © Reuters.

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JOHANNESBURG, April 16 (Reuters) - South Africa's rand edged lower on Thursday as investors digested grim warnings about the global economy and looked ahead to U.S. jobless claims data which has lately been a barometer of the impact of the coronavirus.

The rand ZAR=D3 was as 0.13% weaker at 18.7000 per dollar by 1530 GMT, from an opening level of 18.6750.

The currency had seen some gains earlier in the session as risk demand globally crept back, with oil prices stabilising and the International Monetary Fund (IMF) standing ready to support economies in distress. risk appetite waned as the session wore on and the U.S. data release approached, and investors eyed the greenback and other safe-haven assets.

Forecasts put U.S. weekly jobless claims at 5.1 million, lifting total filings during the crisis above 20 million, a sign of the depth of distress in the world's no. 1 economy that is set to further freeze investors' willingness to deploy cash to risky bets.

Locally, investors remain on the sidelines in anticipation of a government announcement of deeper fiscal measures to limit damage to the economy. But an announcement by President Cyril Ramaphosa set for late Wednesday has been delayed.

"The rand is already trading in deeply oversold territory and selling the up-ticks will still be favoured if one believes that the dollar is also due an extended slide," said analysts at Investec. "The 19.00 handle might therefore prove one target too far, at least for now."

Bonds were firmer, with the yield on the government issue due in 2030 ZAR2030= down 13 basis points to 10.46%.

Stocks slipped a little into negative territory after being positive for most of the day. The FTSE/JSE All Share Index .JALSH closed down 0.12 percent at 46,245.11 while the top 40 index .JTOPI closed 0.05% down at 44,180 points.

The fall was mainly led by banks, with the banking index .JBANK down almost 5% at the close.

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