(Reuters) -South African rand edged down on Wednesday, after data showed inflation soaring to a 13-year high in June on the eve of an interest rate announcement from the central bank.
At 1546 GMT, the rand traded at 17.1225 against the dollar, down 0.13% from its previous close.
Headline consumer inflation, the highest since May 2009, quickened more than forecast to 7.4% year on year in June, versus analysts’ predictions for 7.2% and a reading of 6.5% in May, data from Statistics South Africa showed.
Fuel and food prices continue to be the major drivers of price pressures, which have soared globally due to the war in Ukraine, figures showed.
“With policymakers clearly concerned about the weakness of the economy and core inflation still soft, a 50bp increase (to 5.25%) still seems to be the most likely outcome,” Virag Forizs, an emerging markets economist with Capital Economics, said in a research note.
The South African Reserve Bank (SARB) is due to announce an interest rate decision on Thursday.
Analysts expect the SARB to announce a further 50 basis point rise in the repo rate, which would mark the fifth increase in a row.
Stocks on the Johannesburg Stock Exchange dipped a fraction, with the All-Share index falling 0.2% to 67,652 points, while the Top-40 index closed 0.2% lower at 61,379 points.
The government’s benchmark 2030 bond rose, with the yield down 16.5 basis points at 10.950%.
(Reporting by Anait Miridzhanian in Gdansk and Bhargav Acharya in Bengaluru; Editing by Sherry Jacob-Phillips and Alison Williams)
