South African rand weakens in early trade, stocks open higher

July 22 (Reuters)The South African rand eased in early trade on Friday, shedding the previous day’s gains made in the biggest rate hike in nearly two decades carried out by the central bank to rein in soaring inflation.

At 07:08 GMT, the rand ZAR=D3 traded at 17.0300 against the dollar, 0.06% lower than its previous close.

The rand rose against the dollar on Thursday after the central bank raised its main benchmark rate by 75 basis points to 5.50%.

However, Commerzbank analysts said in a research note that the gains were limited.

“Given domestic risks, the rand is expected to struggle to hold its ground in a challenging environment and come under downward pressure in the event of risk aversion,” the analysts added.

On the stock market, the Top-40 .JTOPI and the wider whole .JALSH the indices rose more than 0.5% in early trading.

The government’s 2030 benchmark bond ZAR2030= was stronger in early trades, with yield down 13.5 basis points to 10.615%.

(Reporting by Anait Miridzhanian in Gdansk; Editing by Christopher Cushing)

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