Rand Strengthens Slightly Ahead Of Key Mining Figures

South Africa’s currency made modest gains on Tuesday morning as markets positioned themselves ahead of two major events: the release of the country’s mining sector data and U.S. inflation numbers that may influence the direction of Federal Reserve interest rate decisions.

By 0702 GMT, the rand was changing hands at 17.8125 per dollar, marking a 0.5% rise compared to where it closed on Monday.

April had seen mining production shrink by 7.7% year-on-year. However, fresh forecasts anticipate a smaller dip, with some economists projecting declines of 5.4% and others suggesting a milder 2.1% contraction.

“Despite marginal improvements, logistics remain a significant hindrance to production, particularly in the current context of subdued commodity prices and soft demand,” Nedbank economists said in a research note.

Meanwhile, the U.S. dollar was stable in relation to a group of major currencies as global traders awaited the upcoming inflation report for June, expected later in the day at 1230 GMT.

In bond markets, South Africa’s 2035 benchmark government security remained steady during early transactions, yielding 9.885%.