[ad_1]
(Updates prices to reflect afternoon trade)
JOHANNESBURG, March 22 (Reuters) – South Africa’s rand strengthened on Wednesday as the U.S. dollar slipped ahead of a highly anticipated interest rate decision by the U.S. Federal Reserve.
At 1625 GMT, the rand traded at 18.3500 to the dollar, about 1.1% stronger than its previous close. South African markets were closed on Tuesday for a public holiday.
The dollar was hovering around five-week lows before the conclusion of the Federal Reserve’s policy meeting, at which investors will be seeking clarity on the path the U.S. central bank could take in the wake of global banking turmoil.
South African inflation data for February and a leading business cycle indicator for January were released on Wednesday, both showing the impact of nationwide rolling power cuts that have crippled businesses across sectors.
Consumer inflation rose slightly
more than expected
to 7.0% year-on-year in February from 6.9% in January. Power cuts are likely fuelling price pressures, analysts said.
A South African composite leading business cycle indicator fell 0.1% month on month in January,
central bank data showed.
“January’s reading was impacted, among other factors, by lower volumes of orders and average hours worked per factory worker in the manufacturing sector, with loadshedding still a key constraint,” Investec analyst Annabel Bishop said in a research note.
However, stocks were up in South Africa and globally, as investors held out hope that the banking crisis might be receding.
On the JSE, the blue-chip Top 40 closed 1.4% higher while the broader all-share index ended up 1.3%.
The government’s benchmark 2030 bond was slightly weaker, with the yield up 2 basis points to 9.995%.
(Reporting by Bhargav Acharya and Nellie Peyton; Editing by Sherry Jacob-Phillips and James Macharia Chege)
[ad_2]
Source link