The rand swung between gains and losses before President Jacob Zuma’s state-of-the-nation address and the release of retail sales and mining production data this week.
South Africa’ currency traded less than 0.1 percent stronger at 8.8740 per dollar as of 8:55 a.m. in Johannesburg after declining as much as 0.2 percent in earlier trading. The rand fell 0.5 percent last week. Yields on benchmark 10.5 percent bonds due 2026 were unchanged at 7.30 percent.
Retail sales growth probably slowed to 1.6 percent in December, from 3.4 percent a month earlier, a report on Feb. 13 will show, according to the median estimate of economists in a Bloomberg survey. Mining production contracted 3.2 percent, a separate report may show on Feb. 14. Zuma is addressing lawmakers on Feb. 14 amid concern about labor unrest, job losses and above-inflation wage increases in Africa’s biggest economy.
“The local focus continues to be on the interplay between the macro backdrop and socio-political tensions,” Carmen Nel, a Cape Town-based analyst at Rand Merchant Bank, said in e-mailed comments. “The state-of-the-nation address will be the marquee event on the local calendar, with President Zuma widely anticipated to deliver a reasonably business-friendly ton.”
A public holiday in some Asian nations to commemorate the Lunar New Year resulted in low trading volumes, according to Quinten Bertenshaw, a Johannesburg-based analyst at ETM Analytics.
“It will be a quieter start for most markets around the globe,” Bertenshaw wrote in e-mailed comments. “It potentially means another day of lethargic range trading that will prevent the rand form adopting any clear-cut directional momentum.”
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