JOHANNESBURG: The South African rand was marginally weaker in early trade on Friday, with its future direction likely to be determined by the outcome of weekend talks between the US and Iran in Islamabad.
At 0606 GMT the rand traded at 16.42 against the dollar , about 0.1% weaker than its previous close. Despite the modest fall, the risk-sensitive currency was set to end the week more than 3% stronger versus the dollar.
The rand surged on Wednesday after US President Donald Trump announced a two-week ceasefire with Iran and has held most of those gains since. Adam Phillips, treasury specialist at Umkhulu Treasury, said in a morning note that the market mood was “steady but nervous”.
For the rand, “it all centres on (the talks in) Islamabad this weekend,” Phillips added. South Africa will hold its weekly inflation-linked bond auction on Friday, but no major domestic economic data is scheduled for release.
February manufacturing production figures published on Thursday showed the sector was weak before the Iran war.
Africa’s biggest economy had started to build momentum last year and investor confidence was on the rise.
Days before the Middle East conflict erupted the South African government predicted growth would accelerate again this year to 1.6%, but that forecast will probably be revised.‑Reuters
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