Rand eases as strike talks stall

Rand eases as strike talks stall

2014-07-15 18:11

Johannesburg - The rand eased against the dollar on Tuesday as prospects for an end to a strike in the metals sector dimmed, with employers withdrawing a final wage offer made to employees.

Companies in the metals and manufacturing sector retracted their offer of a 10% wage offer to striking Numsa, which is seeking annual increases of between 12% and 15% on behalf of its 220 000 members.

The strike has hit the operations of automobile makers as well as manufacturing and construction businesses.

The rand was down 0.3% on the session at R10.7050 at 17:20, after earlier posting modest gains versus the greenback on the back of stronger-than-expected US retail sales numbers.

Dealers said the currency was unlikely to make any major moves outside its recent trading range ahead of a monetary policy decision on Thursday.

"US retail sales data came out a little stronger and the rand started to strengthen. But there's not much in it. It will remain pretty much in the R10.60/65 range," said Ian Martin, a rand trader at Rand Merchant Bank.

Government bonds also strengthened, with the benchmark paper due in 2026 shedding 7 basis points to 8.255% and outperforming the shorter-dated paper due in 2015 which dropped 1.5 basis points to 6.665%.