MTN: 10,771 +134 (+1.26%)
South Africa's rand firms on weaker dollar, stocks fall
* Rand firms on weaker greanback
* Stocks fall on risk-off sentiment
JOHANNESBURG, March 25 (Reuters) - South Africa's rand
firmed on Monday, gaining alongside other emerging market
currencies as concerns over a possible recession in the United
States dented the dollar.
Stocks weakened as sentiment for riskier assets dwindled
with global stocks under pressure as fears for economic growth
sent investors to safe-haven assets.
At 1505 GMT the rand was 0.97 percent firmer at
14.3500 per dollar compared to a close of 14.4900 on Friday in
Most developing world currencies firmed on Monday as the
dollar took a back seat after the U.S. yield curve inverted on
Friday for the first time since mid-2007, the strongest
indication of a possible recession for the world's largest
South African focused investors will this week keep a close
eye on the central bank interest rates decision on Thursday and
a Moody's ratings review on Friday.
The South African Reserve Bank is expected to keep lending
rates steady when it concludes its second monetary policy
meeting for the year on Thursday but may strike a hawkish tone
as oil and electricity prices climb.
"The decision by Moody's is far more touch-and-go as market
participants continue to debate whether South Africa's metrics
have deteriorated enough to warrant a downgrade in its sovereign
outlook," RMB analyst Nema Ramkhelawan-Bhana said in a note.
South Africa's economy has barely grown in the past decade
with fiscal missteps and corruption contributing to weak
business and consumer confidence.
The country has also experienced its worst power cuts in
years this year as state utility Eskom struggles with generation
Bonds also firmed, with the yield on the benchmark paper due
in 2026 falling 4 basis points to 8.71 percent.
On the bourse, the Johannesburg All-Share index
fell 1.32 percent to 55,367 points and the Top-40 index
was 1.27 percent weaker at 49,162 points.
Among the decliners on blue-chip index were Anglo American
Platinum which fell 4.57 percent to 796.86 rand, Tiger
Brands which lowered 2.35 percent to 256.97 rand and
MTN which closed down 3.10 percent to 90.60 rand.
"If you look at the global markets they are just selling off
on fears of global recession," said Vasili Girasis, market
trader at BP Bernstein.
Despite shares being were weaker across the board, the gold
sector, which ticked up 0.68 percent, offering some
relief as they benefited from safe-haven demand in times of
(Reporting by Olivia Kumwenda-Mtambo and Tanisha Heiberg;
Editing by Angus MacSwan)
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