JOHANNESBURG – South Africa’s rand firmed slightly on Tuesday, as the market’s attention turned to this week’s U.S. Federal Reserve meeting where an interest rate hike is expected.
At 1516 GMT, the rand traded at 15.1082 against the dollar, 0.1% stronger than its previous close.
The Fed is set to raise rates for the first time since the pandemic at its meeting, which concludes Wednesday, with traders looking for indications about the pace of future rate hikes.
“Tomorrow’s FOMC (Federal Open Market Committee) rate decision is what everyone will be waiting for and so I guess there will be quite a lot of water treading whilst one eye will be kept on the headlines ticker,” Warrick Butler, chief trader at Standard Bank, wrote in a note.
Traders also expected risk appetite to be kept in check by the Russia-Ukraine crisis, and a retreat in recent commodity price highs.
In fixed income, the yield on the benchmark 2030 government bond was down 4 basis points to 9.785%.
The benchmark all-share index (.JALSH) closed down 1.85% at 70,576, extending declines from its record high of 77,536 on March 2. The bluechip top-40 index (.JTOPI) ended down 1.92% at 64,245.
Shares in Chinese tech giant Tencent (0700.HK), which South African tech investor Naspers Ltd has a large stake in, fell for a third day in Hong Kong.
The Wall Street Journal reported on Monday that Tencent could be fined hundreds of millions of yuan for violating some central bank regulations on WeChat Pay, its mobile network. read more
Naspers fell 3.7%, while Prosus , the Amsterdam- and JSE-listed company through which Naspers holds up to 28.8% in Tencent, dropped 6.4%. Naspers and Prosus together account for over 7% of the benchmark index.