After enjoying a steady climb earlier in the week, the South African rand lost some ground on Thursday morning, weighed down by a stronger dollar and a dip in global gold prices.
By 07:15 GMT, the rand was trading at 17.58 to the dollar, down 0.4% from Wednesday’s closing level. Meanwhile, the dollar edged up 0.1% against a basket of major global currencies, and spot gold slipped 0.3%.
The rand’s recent strength had been supported by growing investor confidence that South Africa’s long delayed budget would finally be approved. That optimism was confirmed late Wednesday when Parliament passed the last key budget bill, following months of wrangling. The breakthrough came after the two largest parties in the ruling coalition reached a compromise.
With no major local data expected for the rest of the week, analysts say the rand is likely to be guided by broader global trends in the short term.
Elsewhere, the Johannesburg Stock Exchange’s Top-40 index (.JTOPI) rose 0.3% in early trade. The yield on the benchmark 2035 government bond was steady at 9.82%.
