South Africa’s rand kicked off Monday on the back foot against the dollar as concerns about higher lending rates in the United States and an escalation in a trade war between Washington and Beijing subdued demand for emerging market currencies.
At 0615 GMT the rand was 0.13 percent weaker at 15.2600 per dollar compared to a close of 15.2400 on Friday in New York.
Strong U.S. August jobs data lifted the greenback on Friday, while fears that the trade battle between the United States and China would strangle a rebound in global growth kept investors cool on emerging market assets.
U.S. President Donald Trump said on Friday he was ready to slap tariffs on virtually all Chinese imports, threatening duties on another $267 billion of goods in addition to the $200 billion already facing the risk of duties.
The rand had staged a decent recovery late in the previous week after data showing South Africa’s current deficit narrowed to 3.3 percent of GDP in the second quarter from 4.6 percent, triggering some short-covering by traders ahead of the U.S. jobs data.
Investors remain skittish on the rand though following second quarter gross domestic product data earlier last week showing the economy shrank 0.7 percent.
Bonds were weaker, with the yield on the benchmark paper due in 2026 rising 7 basis points to 9.21 percent.
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