Rand Slips as Dollar Strengthens, Mining Data Disappoints
By Aboki Forex —
JOHANNESBURG – The South African rand weakened against a stronger dollar on Thursday, as global markets focused on a high-stakes meeting between U.S. President Donald Trump and Chinese President Xi Jinping in Beijing.
Xi told Trump that trade talks were making progress at the start of their two-day summit. But he warned that disagreement over Taiwan could send relations down a dangerous path and even lead to conflict.
At 1345 GMT, the rand traded at 16.4499 to the dollar, down about 0.3% from its previous close. Like other risk-sensitive currencies, the rand often takes cues from global events in addition to local economic data.
South Africa’s mining output rose 2.5% year on year in March, Statistics South Africa data showed on Thursday. That was lower than the 4.1% predicted by analysts polled by Reuters, and below the 9.7% increase recorded in February.
“We have started to see upside pressure on mining input costs as a result of the war in the Middle East,” said Investec economist Lara Hodes in a research note. Hodes added that depending on the length and severity of the conflict, miner profitability could remain under pressure. She noted that miners also face domestic challenges like failing water infrastructure and policy uncertainty.
On the Johannesburg Stock Exchange, the Top-40 index was down 0.3% in afternoon trade. South Africa’s benchmark 2035 government bond firmed, with the yield falling 5 basis points to 8.665%.