JOHANNESBURG (Reuters) -The South African rand lost ground on Monday, bruised by a strong dollar and lengthy power cuts by state-owned utility Eskom.
At 1602 GMT, the rand traded at 17.7250 against the dollar, 0.64% weaker than its previous close. In the morning the rand had fallen to 17.7850, its lowest level in more than two years.
The dollar was up over 0.2% against a basket of currencies, as investors braced for a large interest rate hike from the U.S. Federal Reserve this week.
“Financial markets have started to factor in more than a 75-basis-point hike in the U.S., which has negatively affected risk sentiment, causing the rand to weaken towards R18.00/USD,” Investec economist Annabel Bishop said in a research note.
South African President Cyril Ramaphosa will miss the United Nations General Assembly this week to address a national power crisis at home, his spokesman told local media, as the country continues to experience significant power cuts.
On the stock market, the Top-40 index was down 0.08%, while the broader all-share index ended 0.16% lower.
The government’s benchmark 2030 bond was weaker in afternoon trade, with the yield rising 10 basis points to 10.440%.
(Reporting by Alexander Winning and Anait Miridzhanian; Editing by Toby Chopra)
