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(Updates prices to reflect afternoon trade)
JOHANNESBURG, Aug 18 (Reuters) - The South African rand fell on Thursday, extending the previous day’s losses, as the dollar bounced on investor uncertainty surrounding the pace of interest rate hikes by the U.S. Federal Reserve to tame inflation.
Federal Reserve minutes on Wednesday pointed to U.S. interest rates staying higher for longer, boosting the dollar and hurting emerging market currencies like the rand.
At 1536 GMT, the rand traded at 16.8050 against the dollar, down 1.13% from its previous close.
With no major domestic economic data releases on Thursday, the South African currency took its cue from global drivers as expected.
The dollar index, which measures the currency against six rivals, earlier hit a three-week high following the Fed minutes and was last up at 107.07.
“A weakening U.S. economic environment places downwards pressure on global economic growth, and so on SA (South Africa) economic activity,” Investec analyst Annabel Bishop said in a research note, adding that local June retail sales were also a factor in the rand’s weakness.
June retail sales published on Wednesday registered a surprise fall, adding to evidence the economy performed poorly in the second quarter.
Next week the data calendar is busier with July consumer and producer inflation, second-quarter unemployment and a leading business cycle indicator .
Shares on the Johannesburg Stock Exchange (JSE) ended marginally up in the absence of major catalysts, with the All-Share index ending up 0.06% and the Top-40 index closing 0.03% higher.
The South African government’s benchmark 2030 bond fell marginally, with the yield up 1.5 basis points to 10.185%. (Reporting by Alexander Winning and Bhargav Acharya Editing by Mark Potter and Elaine Hardcastle)
