Rand eases, ending US payroll rally

Johannesburg - The rand weakened early on Tuesday, pulling back from a month-high as the US dollar regained its footing following steep losses triggered by soft jobs numbers.

At 08:50 the rand had slipped 0.2% to R11.8135/$, some way from the R11.6950 high it touched in the previous session.

"The rand's post-payrolls gains have not sustained and we expect a drift weaker today," said currency trader John Cairns, of Rand Merchant Bank, in a market note.

A dearth of domestic data this week is likely to tie rand moves to the dollar's performance, with focus mostly on the release of the Fed's minutes from its last meeting, Cairns said.

The timing of the Federal Reserve's interest rate hike remains unclear, with Fed comments on Monday suggesting a plan to tighten monetary policy around mid-year had been derailed by the recent string of disappointing data.

"The question now becomes whether this Q1 2015 weakness is transitory or whether it signifies a more permanent slowing of economic growth. The betting so far is for the former," Cairns added.

Yields fell on most government bonds, with the benchmark paper due in 2026 shedding 7.5 basis points to 7.64%, near its lowest level in two weeks.

HSBC's March purchasing manager's index is due at 09:15, with mining and manufacturing data to be released on Thursday.