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South African Rand Falls on Power Cuts, Risk-Off Sentiment

JOHANNESBURG, Sept 6 (Reuters) - The South African rand weakened on Wednesday, as the country continued to be battered by its worst rolling blackouts on record and as markets moved away from riskier assets.

At 1110 GMT, the rand traded at 19.2575 against the dollar , 0.3% weaker than its previous close.

The dollar last traded around 0.09% weaker against a basket of global currencies.

"The rand has struggled for any traction through the first half of the week," said Danny Greeff of ETM Analytics, as sentiment towards riskier currencies like the rand soured.

"Simultaneously, there is very little in the way of positive news flow out of South Africa for investors to focus on."

South Africa's struggling state utility Eskom reinstated the worst rolling blackouts on record, which mean up to 12 hours of power cuts for most households per day.

Adding fuel to the fire, petrol and diesel prices were also hiked on Wednesday, hurting Africa's most industrialised economy.

This exacerbates the country's fiscal crisis and deters investment in the rand and government bonds, Greeff added.

On the Johannesburg Stock Exchange, the blue-chip Top-40 and the broader all-share indexes were both last trading over 0.9% weaker.

South Africa's benchmark 2030 government bond was stronger, with the yield down 4 basis points to 10.370%.

Reporting by Tannur Anders; Editing by Nellie Peyton, Christina Fincher, Bhargav Acharya

Source: Reuters


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