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Rand weakens ahead of slew of data

Johannesburg - The rand softened on Monday following a week of solid gains as the dollar bounced back ahead of a data-filled week locally and abroad.

By 06:40 the rand eased 0.4% to R11.8275/$, having touched two-week highs as the greenback was weighed down by poor economic data suggesting the Federal Reserve would delay hiking rates.

The index measuring the dollar against major currencies showed the greenback 0.35% firmer as it recovered from three-month lows, finding some technical support after Friday's slide fuelled by weak a factory activity report.

Unemployment, inflation and retail figures are to be published in the week before the South African Reserve Bank (SARB) announces its decision on interest rates on Thursday.

Economists polled by Reuters said the Reserve Bank would not raise interest rates until at least November, as it waits for inflation to reach its comfort level.

READ: SARB won't raise rates over temporary inflation breach

A weaker rand remained a worry for some economists, the poll also found; however, inflation remains under SARB's upper limit of 6%.

The rand has shed close to 3% versus the dollar in the past month, according to Thomson Reuters data, as fundamental weaknesses in the local economy and the spectre of a rate hike in the US weighed.

Power shortages were the biggest risk facing the economy, Finance Minister Nhlanhla Nene said on Monday at a press briefing, as state utility Eskom battles to meet demand and plug a R200bn funding gap.

READ: Eskom: Africa needs R5.5trn investment to curb power cuts

Government bonds were mostly flat, with the benchmark instrument due in 2026 shedding half a basis point to 7.97%.

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Rand - Dollar
18.95
-0.1%
Rand - Pound
23.91
-0.0%
Rand - Euro
20.42
+0.1%
Rand - Aus dollar
12.34
+0.0%
Rand - Yen
0.13
-0.1%
Platinum
908.05
+1.2%
Palladium
1,014.94
+1.3%
Gold
2,232.75
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Silver
24.95
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Brent-ruolie
87.00
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Top 40
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All Share
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Resource 10
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Industrial 25
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Financial 15
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