Rand extends losses as power cuts highlight economic risks
The South African rand slipped on Wednesday, extending losses from the previous session, as severe power cuts and floods highlighted economic constraints in Africa's most industrialised nation.
At 0705 GMT, the rand traded at 14.9750 against the dollar, around 0.2% weaker than its previous close.
The rand weakened nearly 2% on Tuesday, when state power utility Eskom ramped up scheduled power cuts following trips at its faulty coal-fired power stations.
ETM Analytics said the "Stage 4" power outages were a big red flag to investors.
"The rand has been trading like a safe-haven currency in recent months. Its link to the commodity cycle was difficult to ignore, and investors traded it as a proxy for commodities," ETM Analytics wrote in a research note. "It traded like a currency that belonged to a stable country with relatively few problems, and South Africa is, of course, far from that."
Around 0800 GMT, Statistics South Africa is expected to publish March consumer price index figures.
Analysts polled by Reuters are expecting annual consumer inflation to accelerate to 6.0% from 5.7% in February, testing the upper bound of the central bank's target range of 3% to 6%.
On the Johannesburg Stock Exchange, the Top-40 index was 0.2% weaker in early trade. The government's benchmark 2030 bond was also slightly weaker, as the yield rose 2 basis points to 9.935%.
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