July 6 (Bloomberg) -- The rand declined for a third day after the U.S. hired fewer workers than forecast last month and interest-rate cuts in Europe and China failed to assure investors the moves will be enough to boost economic growth.
South Africa’s currency retreated as much as 1.8 percent and traded 1.6 percent weaker at 8.2762 per dollar by 4:19 p.m. in Johannesburg, the worst performer of 16 major currencies monitored by Bloomberg. The rand has declined 1.3 percent this week. Yields on the nation’s 6.75 percent bonds due 2021 rose four basis points to 7.14 percent.
U.S. payrolls rose 80,000 last month after a 77,000 increase in May, less than a 100,000 gain forecast in a Bloomberg survey, Labor Department data showed. The European Central Bank yesterday reduced its benchmark rate to a record low of 0.75 percent and the People’s Bank of China cut borrowing costs for a second time in a month.
“The markets have responded negatively in what appears to be a realization that the economic downturn might be more severe and protracted than first thought,” Quinten Bertenshaw, a Johannesburg-based analyst at Tradition Analytics, said by e-mail today. “For now, the potential for risk-off gathering momentum is high.”
Three-month copper declined the most in two weeks, and Standard & Poor’s GSCI index of commodities fell 1.9 percent. Metals and other raw materials account for almost half of South Africa’s exports, according to government data.
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