The South African Rand has continued to slide against the US Dollar and a basket of its currencies after being weighed down by weaker-than-expected PMI data out of China and fears over possible disruptions to the nation’s electricity supply.
Power company Eskom warned yesterday that was preparing to implement rolling blackouts in the winter in some parts of the national grid to prevent the entire system from collapsing, something that would inflict massive damage to the South African economy. The rand fell to R9.30 in intraday trade, the weakest level in a month, and was bid at R9.2688 to the dollar at 5pm Monday, as the currency retreated for a fourth day on concern that electricity supply constraints would weigh on the economy.
The Rand has received a further blow after data showed that growth in the factory sector of the world’s second-largest economy dipped in April as Chinese export orders declined. HSBC’s preliminary purchasing managers’ index came out at 50.5 for April compared with a final reading of 51.6 for March. A score above 50 indicates an expansion in manufacturing activity. The data added to the currency’s declines after it suffered from a tumble in commodity prices last week.
“The Rand has moved lower based primarily on the weaker Chinese data,” said Asba Capital trader Duncan Howes. “Given that China is South Africa’s largest trading partner it can have a fairly substantial effect on trade.”
The Rand is expected to remain under pressure for the short term and is likely to trade within the R9.22-R9.34 range.
Current ZAR Exchange Rates
The South African Rand to Euro exchange rate is currently trading at 0.0828
The South African Rand to US Dollar exchange rate is currently trading at 0.1075
The South African Rand to Pound Sterling exchange rate is currently trading at 0.0706
The US Dollar to South African Rand exchange rate is currently trading at 9.2998
The Pound Sterling to South African Rand exchange rate is currently trading at 14.1507
These exchange rates were correct as of 09:35 am GMT
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