JOHANNESBURG (Reuters) – South Africa’s rand strengthened on Thursday as the dollar weakened after recent U.S. economic data signalled a softening U.S. labour market.
At 1536 GMT, the rand traded at 18.49 against the dollar, up 0.5% from its previous close.
The dollar index was down about 0.2% against a basket of currencies after U.S. data showed claims for unemployment benefits rose last week to the highest level in more than eight months.
U.S. market participants have looked to a softening labour market as a sign that consumers will begin to slow spending and in turn help cool inflation.
The rand, like most emerging market currencies, takes direction from U.S. economic data points in addition to local events.
Statistics South Africa data earlier in the day showed manufacturing output fell 6.4% year-on-year in March, after rising by a revised 4.0% in February.
On the stock market, the Top-40 index closed 0.56% higher.
South Africa’s benchmark 2030 government bond was weaker, with the yield up 1.5 basis points at 10.530%.
(Reporting by Nellie Peyton and Bhargav Acharya; Editing by Christopher Cushing and Mark Potter)
