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FILE PHOTO: An illegal currency dealer holds a wad of Zimbabwean bond notes and South African Rands outside a bank in Harare, Zimbabwe

South Africa's rand slips as global risk rally slows

JOHANNESBURG (Reuters) - South Africa's rand slipped on Tuesday, surrendering the previous session's scant gains as the dollar steadied from a sell-off triggered by fears the United States economy is heading for recession.

The rand was 0.07 percent weaker at 14.3200 per dollar at 0645 GMT, compared to a close of 14.3100 overnight in New York.

On Monday, the rand gained nearly 2 percent in a broad emerging market rally sparked by renewed fears that economic growth in developed markets was set to contract after an inversion of the U.S. yield curve and poor manufacturing data from Germany and Japan.

But the rally lost steam in early trade as investors banked profits, with ongoing chaos around Britain's exit from the European Union cooling global risk demand.

British lawmakers are due vote on a range of Brexit options on Wednesday.

Locally, with no top tier data due, investors are waiting for Thursday's central bank monetary policy decision.

A Reuters poll last week forecast the bank will leave lending rates unchanged 6.75 percent, with inflation trending around 4 percent, supporting bids for the rand.

Bonds weakened slightly, with the yield on benchmark 2026 paper adding 0.5 basis points to 8.715 percent.

(Reporting by Mfuneko Toyana; Editing by Kirsten Donovan)

2019-03-26 09:22:23

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