(Reuters) -South Africa’s rand weakened on Thursday, as the U.S. dollar rose after Federal Reserve Chair Jerome Powell reiterated a hawkish tone to battling inflation.
At 1609 GMT, the rand traded at 17.5225 against the dollar, 1.59% weaker than its previous close.
The dollar index, which measures the currency against six rivals, was up 0.346% at 110.070, after hitting a peak of 110.79 on Wednesday, a level unseen since June 2002.
Central bank data showed on Thursday that South Africa’s current account balance dipped to a deficit of 1.3% of gross domestic product (GDP) in the second quarter from a surplus of 2.4% of GDP in the first quarter.
“The increase in volumes and prices of imports, which were higher than the export gains, tipped the current account into a deficit for the first time since the second quarter of 2020,” Nedbank economists said in a research note.
South Africa’s manufacturing output rose 3.7% year on year in July after falling by 3.4% in June, statistics agency data showed.
The country’s consumer confidence improved in the third quarter, a survey showed on Thursday, but consumer sentiment remained “extremely depressed” amid rising inflationary pressures.
On the Johannesburg Stock Exchange (JSE), the Top-40 index closed 0.77% higher, while the broader all-share index rose 0.82%.
However, shares in Capitec fell more than 9% after the lender forecast its half-year headline earnings per share to rise between 15% and 18%.
This estimate is below Jefferies’ expectations of 21%.
“We believe the current inflationary environment, coupled with relatively robust loan growth has likely led to marginally higher credit losses for the first half of 2023”, Jefferies added.
Shares in Anglo American Platinum dropped almost 5% after the producer of platinum group metals cut its 2022 forecast for refined production.
The government’s benchmark 2030 bond was almost unchanged, with the yield at 10.380%.
(Reporting by Bhargav Acharya in Bengaluru and Anait Miridzhanian in JohannesburgEditing by Peter Graff and Shinjini Ganguli)
