* Euro, weak trade stats weigh on rand
* Rand vulnerable as Reserve Bank won’t intervene
JOHANNESBURG, June 25 (Reuters) – South Africa’s rand fell
as much as 1.4 percent on Monday to a three-week low against the
dollar as uncertainty over euro zone debt undermined global
investors’ demand for riskier emerging market assets.
Government debt also weakened, pushing the yield on the
benchmark three-year bond up 6 basis points to 6.08
percent, pulling back further from a record low of 5.97 percent
hit last week.
The longer-dated 2026 paper fell more heavily,
with its yield rising nearly 10 basis points to 8.095 percent.
The rand, one of the most heavily traded and freely
floating of emerging market currencies, was at 8.5015 at 1505
GMT, its third straight session on the back foot as the euro,
the currency of South Africa’s biggest trading partner, fell
against the dollar.
Doubts over whether a European summit later this week will
make any headway in resolving the bloc’s debt crisis weighed on
the single currency, and by extension emerging market assets.
“The rand is reacting in a normal way to the euro falling,”
said Murat Toprak, a regional currency strategist at HSBC.
“But underperformance of the rand is more than usual,
because when you look at the other currencies within the Europe,
Middle East and Africa region, the magnitude of the weakness is
not that big.”
Continued…
