FILE – South African rand coins are seen in this illustration photo taken Oct. 30, 2020. File photo: Reuters/Mike Hutchings/Illustration)
The South African rand weakened on Monday under pressure from a stronger US dollar and a surge in oil prices, as rising tensions between the United States and Iran weighed on global market sentiment.

  • At 1334 GMT, the rand traded at 16.6925 against the dollar, down 0.5% from its previous close.

  • The safe-haven US dollar rose against other currencies, while oil rose more than 3% to more than $110 a barrel.

  • Tehran said it had forced a US warship to turn back from the Strait of Hormuz, although US Central Command immediately denied a report by Iran's semi-official Fars news agency that two missiles had struck the ship.

  • The rand has been at the mercy of global market sentiment since the US and Israel launched war on Iran in late February and Tehran later retaliated.

  • South African manufacturing sentiment improved in April as output and new sales orders increased again after a weak first quarter.

  • Separately, data from South Africa's auto association NAAMSA showed new vehicle sales rose 13% year-on-year in April, compared with a 17.3% increase in March, as domestic demand continued to support the industry despite global uncertainty.

  • “The latest results demonstrate that the market is still benefiting from prior cyclical support, even as external shocks are reshaping the operating environment,” NAAMSA said in a statement.

  • The top-40 index on the Johannesburg Stock Exchange was down 0.2%.

  • South Africa's benchmark 2035 government bond was slightly stronger, as the yield fell 1 basis point to 8.785%.

Source: reuters

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