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South Africa’s rand weakens ahead of GDP data

South Africa’s rand weakens ahead of GDP data


South Africa’s rand weakened in early trade on Tuesday ahead of the release of third-quarter gross domestic product (GDP) data, which is expected to show a recovery after a steep contraction in the previous quarter.

At 0615 GMT, the rand ZAR=D3 traded at 15.1675 versus the dollar, 0.18% weaker than its previous close.

The rand has gained about 6% against the U.S. currency since the start of November, supported by an uptick in global risk appetite that has largely outweighed investors’ worries about South Africa’s dire economic situation.

Third-quarter growth data ZAGDP=ECI is due at 0930 GMT.

Analysts polled by Reuters predict a 52.6% expansion in quarter-on-quarter terms in the July-September quarter, after a 51% contraction in the prior three months. A 7.2% contraction is expected in year-on-year terms.

In fixed income, the yield on the benchmark government bond due in 2030 ZAR2030= was up a basis point to 8.94%.

Source: Reuters

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