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Johannesburg - The rand extended losses against the US dollar on Monday, tumbling towards fresh three-week lows after weaker exports widened the trade deficit and underscored the growing fragility of the economy.
READ: SA trade deficit shocker
The local unit slipped 0.5% to R11.1150 by 08:36 after ending softer on Friday, with scope for further declines seen coming from dollar strength against a poor global economic backdrop.
The dollar traded on the front foot against most major currencies, boosted by a fall in the gold price and a continued decline among commodity-backed currencies.
READ: Gold tumbles, oil hits 5-year low
The trade account yawned sharply to R21.33bn in October as imports soared by 17.8%, the deficit jumping to a cumulative R95.11bn for 2014.
"The significant deficits again underscore the economy's weak economic fundamentals," Christie Viljoen, an analyst at NKC Independent Economist, said in a market note.
"Disparity between inflows and outflows translates into weaker demand for the rand."
Government bonds were also weaker in early trade, with the yield on the benchmark government paper due in 2026 up 2.5 basis points to 7.635%.
The November new car sales data are due at 11:00.
ALSO READ:
SA leads Africa in economic integration
Infographic: The good, the bad and the ugly of SA's GDP
Economy grows 1.4% in Q3
READ: SA trade deficit shocker
The local unit slipped 0.5% to R11.1150 by 08:36 after ending softer on Friday, with scope for further declines seen coming from dollar strength against a poor global economic backdrop.
The dollar traded on the front foot against most major currencies, boosted by a fall in the gold price and a continued decline among commodity-backed currencies.
READ: Gold tumbles, oil hits 5-year low
The trade account yawned sharply to R21.33bn in October as imports soared by 17.8%, the deficit jumping to a cumulative R95.11bn for 2014.
"The significant deficits again underscore the economy's weak economic fundamentals," Christie Viljoen, an analyst at NKC Independent Economist, said in a market note.
"Disparity between inflows and outflows translates into weaker demand for the rand."
Government bonds were also weaker in early trade, with the yield on the benchmark government paper due in 2026 up 2.5 basis points to 7.635%.
The November new car sales data are due at 11:00.
ALSO READ:
SA leads Africa in economic integration
Infographic: The good, the bad and the ugly of SA's GDP
Economy grows 1.4% in Q3
