JOHANNESBURG – South Africa’s rand fell to its weakest in three weeks after data showed private sector activity contracted for the first time in nine months in April, while a hawkish statement from the U.S. central bank added to the bearish sentiment.
By 1515 GMT, the rand was trading 0.9 percent weaker at 13.5675, a level not seen since April 14.
The Standard Bank Purchasing Managers’ Index, compiled by Markit, edged down to 50.3 in April from 50.7 in March as new orders declined in the wake of a cabinet reshuffle that rattled investor confidence.
“The rand continues to lose ground against many of its trading partners as money continues to drip out the country in search of greener pastures – higher yield, more political stability – elsewhere,” Standard Bank’s trader Warrick Butler said.
Mining shares featured among the decliners on the benchmark index as commodity prices slid, with gold hitting a six-week low on expectations of further U.S. interest rate rises this year and receding political uncertainty in Europe.
The benchmark JSE Top-40 index was off 0.36 percent at 46,747, and the broader All-share index dipped 0.34 percent to 53,406.
In fixed income markets, the yield on the benchmark government bond due in 2026 rose 1 basis point to 8.685 percent.
(Reporting by Nqobile Dludla and Tiisetso Motsoene