UPDATE 1-South African rand recovers from 4-month low after U.S. payrolls data

Published: 2023-10-06 tag: 0

The South African rand recovered some losses on Friday after slumping to a four-month low earlier on the back of positive U.S. payrolls data.

South African Rand coins are seen in this illustration picture taken October 30, 2020. REUTERS/Mike Hutchings/Illustration/File photo Acquire Licensing Rights

JOHANNESBURG, Oct 6 (Reuters) - The South African rand recovered some losses on Friday after slumping to a four-month low earlier on the back of positive U.S. payrolls data.

At 1328 GMT, the rand traded at 19.5150 against the dollar , near its previous close of 19.5125.

It earlier touched 19.6400 - its lowest since June - after non-farm payrolls data out of the United States showed a larger than expected increase in jobs for September.

The dollar last traded around 0.3% stronger against a basket of global currencies.

Analysts had earlier warned that encouraging U.S. employment figures would bolster the dollar and adversely impact the rand.

The rand has lost about 12.7% against the greenback since the start of the year.

"The rand has remained very weak this year, far removed from its fair value of closer to R15.00/USD. Substantial US dollar strength has been a key reason," said Investec economist Annabel Bishop in a research note.

Locally, South Africa's net foreign reserves fell to $54.980 billion by the end of September from $55.444 billion in August, central bank data showed on Friday (ZAFXRS=ECI).

On the Johannesburg Stock Exchange, the blue-chip Top-40 index (.JTOPI) last traded around 0.4% higher.

South Africa's benchmark 2030 government bond was slightly stronger, with the yield down 4 basis points to 10.965%.

Reporting by Tannur Anders Editing by Bhargav Acharya, Mark Potter and Angus MacSwan

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