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Rand eases ahead of data

Dec 06 2012 10:04
Johannesburg - The rand eased slightly against the dollar in early trade on Thursday ahead of key domestic current account data and amid more weakness in the euro, the currency of South Africa's largest trading partner.

The rand traded at R8.7775 at 08:39 against the greenback, marginally softer than Wednesday's New York close of R8.7650.

Jim Bryson, a currency trader at Rand Merchant Bank, said previous current account figures had put pressure on the currency, and a worse-than-anticipated figure for the third quarter would add to that.

"Going on the last couple of figures, I wouldn't expect anything too cheerful," Bryson said.

Economists surveyed by Reuters expect the third quarter deficit to have swollen to 6.55% of gross domestic product, after posting its biggest figure in over three years in the second quarter, at 6.4% of GDP.

The data will be released at 10:00.

In the eurozone, the European Central Bank is widely expected to keep rates on hold at 0.75% at its policy meeting, although it is likely to paint a gloomy economic outlook, with cuts to its growth forecasts for this year and next.

Investors will look for clues about whether ECB President Mario Draghi will show a greater willingness to cut borrowing costs in the future.

South African government bonds firmed ahead of the data, with yields nudging down 2.5 basis point to 7.485% on the 14-year benchmark bond and a single basis point on the 2015 note to 5.495%.

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