JOHANNESBURG (Reuters) -The South African rand extended gains on Friday as the U.S. dollar fell, leaving the rand slightly stronger than it was at the start of a bumpy week.
At 1532 GMT, the rand traded at 19.0925 to the dollar, about 0.5% stronger than its previous close.
The dollar last traded around 0.1% weaker against a basket of global currencies.
The rand had weakened to 19.3 to the dollar earlier this week as South Africa’s state utility Eskom reinstated the country’s worst-ever level of power cuts, resulting in up to 12 hours of outages a day for many households and businesses.
Power cuts have battered South Africa’s economy this year. Current account data on Thursday showed the country’s deficit widened to 2.3% of gross domestic product in the second quarter.
The rand has lost more than 12% against the greenback since January.
“Falling U.S. Treasury yields have helped the ZAR recover some ground against the dollar through the second half of the week,” said Danny Greeff of ETM Analytics, adding that a strong rand recovery is only likely to happen if the dollar weakens further.
“The local unit is sorely lacking anything in the way of resilience … due to (South Africa’s) weak risk profile, which is mainly a function of chronic fiscal maladministration,” he added.
On the Johannesburg Stock Exchange, the blue-chip Top-40 index and the broader all-share index ended the day about 0.65% higher.
South Africa’s benchmark 2030 government bond was slightly stronger, with the yield down 1 basis point at 10.375%.
(Reporting by Tannur Anders; editing by Nellie Peyton and Mark Heinrich)
