JOHANNESBURG (Reuters) -The South African rand weakened on Thursday against a stronger dollar, after a softer-than-expected private payrolls report bolstered bets that the Federal Reserve will cut rates at its next meeting.
U.S. private payrolls increased less than expected in August, rising by 54,000 jobs last month, while economists polled by Reuters had forecast private employment to increase 65,000.
At 1346 GMT, the rand traded at 17.7675 against the dollar, about 0.5% weaker than Wednesday’s close.
Like other risk-sensitive currencies, the rand often takes cues from global drivers such as U.S. policy and economic data in the absence of major domestic economic releases.
Analysts say the commodity-backed currency has not performed well recently, as it has remained range-bound even after gold prices hit an all-time peak.
Like other major producers of precious metals, South Africa often benefits from higher gold prices.
The U.S. dollar inched up 0.1% against a basket of currencies as investors awaited U.S. non-farm payrolls data due on Friday.
Traders will also continue to assess a court ruling that found most of U.S. President Donald Trump’s tariffs are illegal.
“This development means that the USD will remain constrained and the ZAR will remain resilient through the foreseeable future,” said ETM Analytics in a research note.
On the Johannesburg Stock Exchange, the Top-40 index last traded down 0.8%.
South Africa’s benchmark 2035 government bond also strengthened , bringing the yield down 2.5 basis points to 9.62%.
(Reporting by Sfundo Parakozov and Anathi Madubela;Editing by Barbara Lewis)
