Rand Resumes Tumble on U.S. Economic DataJaco Visser
The rand posted the second-biggest decline among emerging-market currencies as declining U.S. consumer confidence and a lower growth forecast from the International Monetary Fund outweighed progress in South African labor talks.
The South African currency fell 1 percent to 9.9478 per dollar, the most among 24 developing-nation currencies tracked by Bloomberg except Brazil’s real, a day after surging more than 2 percent and ended the week little changed. The currency is down 15 percent this year.
The rand rose earlier in the day after South African mining companies, labor unions and the government agreed on a draft pact outlining how they will restore peace in the industry. The outlook for U.S. economic growth next year worsened as the IMF lowered its prediction to 2.7 percent from the 3 percent forecast in April. The Thomson Reuters/University of Michigan index showed consumer sentiment for June declined to 82.7, below the 84.5 median estimate of 70 economists surveyed by Bloomberg.
Yields on South Africa’s 10.5 percent rand-denominated government debt due December 2026 fell 12 basis points to 7.78 percent, the lowest in more than a week on a closing basis.