JOHANNESBURG (Reuters) -South Africa’s rand firmed on Thursday, recouping losses from the previous session, with investor focus turning to the mid-term budget next week.
At 1704 GMT, the rand traded at 18.9825 against the dollar, about 0.7% stronger than its previous close.
The dollar was last up more than 0.2% against a basket of global currencies.
Investors are gearing up for the mid-term budget on Nov. 1, when the country’s deteriorating public finances will be in the spotlight.
South Africa’s social relief grant, introduced in 2020 to support those hardest hit by the COVID-19 pandemic, is likely to be extended beyond next March, economists said.
State-owned logistics company Transnet said it had requested an unspecified cash injection from the government as it seeks to reduce debt and return to profitability.
Statistics South Africa figures showed September producer inflation came in at 5.1%, above economists’ predictions for 4.7%.
Economists at Nedbank said in a note that producer prices were likely to continue rising gradually in the coming months, ending the year around 6% higher than a year earlier
Shares on the Johannesburg Stock Exchange fell, with the blue-chip Top-40 index closing 0.45% lower.
South Africa’s benchmark 2030 government bond was weaker in late deals, with the yield up 7 basis points to 10.700%.
(Reporting by Tannur Anders and Anait Miridzhanian, Editing by Bhargav Acharya, Subhranshu Sahu and Tomasz Janowski)
