JOHANNESBURG (Reuters) -South Africa’s rand edged lower on Monday, as investors await Wednesday’s mid-term budget review – the first under the coalition government formed in June.
At 1501 GMT, the rand traded at 17.7075 against the U.S. dollar, down 0.2% from its previous close.
Finance Minister Enoch Godongwana’s budget policy statement to parliament will include an update on the health of public finances midway through the fiscal year.
A Reuters poll of economists published last week predicted that Godongwana will announce a lower 2024/25 budget deficit estimate than was given in February’s main budget, but fiscal challenges are expected to slow consolidation efforts next year.
“Although this is not a policy-setting event, any indication of credible fiscal reforms would support market confidence and the rand,” Andre Cilliers, currency strategist at TreasuryONE, said in a note.
Other domestic data releases this week include September credit extension and money supply data on Tuesday, September producer inflation and trade balance data on Thursday, and October vehicle sales figures on Friday.
On the stock market, the Top-40 index closed 0.6% higher.
South Africa’s benchmark 2030 government bond was marginally weaker, with the yield up 0.5 basis points to 9.29%.
(Reporting by Tannur Anders with additional reporting by Bhargav Acharya; Editing by Alexander Winning, Jan Harvey and Helen Popper)
