Rand weakens, stocks set to open lower

folarin okunola

May 13, 2016 5:01 PM

At 0645 GMT, the rand traded at 15.1450 versus the dollar, 0.64 percent weaker from Thursday's New York close.

South African Rand coins are seen in this photo illustration taken September 9, 2015. REUTERS/Mike Hutchings

South Africa's rand weakened early on Friday after the dollar held to gains against major currencies as traders awaited economic data from the United States later in the day that could set the greenback's tone.

"Traders are likely looking ahead to today’s U.S. data releases, as well as next week’s central bank meeting," NKC African Economics said in a note.

South Africa's central bank will announce its latest interest rates decision on May 19, with economists saying the repo rate will likely be left unchanged due to slower inflation and a perkier rand.

The dollar's index against a basket of six major currencies was up 0.18 percent at 94.321.

The currency market will have a chance to gauge the underlying strength of the U.S. economy through a batch of data, including retail sales figures, to be released later in the day.

The dollar could face renewed pressure if the U.S. economic indicators fall short of expectations.

Locally, focus was also on April consumer inflation data due on May 18.

Stocks were set to open lower at 0700 GMT, with the JSE securities exchange's Top-40 futures index down 0.55 percent.

Government bonds also weakened, and the yield for the benchmark instrument due in 2026 added 4.5 basis points to 9.19 percent.

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