The rand on Monday touched its weakest level to date against the dollar‚ at R13.9804‚ as possible interest rate hikes in the US and Chinese market uncertainty weighed on the local currency.
Bidvest Bank said in a note that rand weakness had “accelerated at a remarkable pace” over the past two to three weeks.
At 3.31pm the rand was at R13.9300 to the dollar from Friday’s close of R13.8642. The rand was at R15.5488 against the euro from R15.4782 previously and was at R21.2717 against the pound from Friday’s close of R21.0486.
The euro was $1.1161 from $1.1163.
The trade-weighted rand index continued to touch new record weak levels almost daily‚ highlighting the momentum in the move‚ Bidvest Bank said.
The rand had now weakened 3.8% on a trade-weighted basis between Friday August 28 and Friday September 4‚ taking it 12% weaker year to date‚ the bank said.
The rand was weaker than its previous record low of R13.84 to the greenback on Friday after US nonfarm payroll data supported a possible US interest rate hike this year.
Investec group economist Annabel Bishop said should the rand pierce the key resistance level of R14 per dollar‚ R14.20 to the greenback would be the next key level.
“In 2001 when the rand weakened to R13.84 to the dollar it was ‘on a spike in very thin liquidity conditions’‚ with the rand moving from R12.62 to the dollar on December 19, 2001‚ to R13.84 to the dollar on December 21, 2001. The currency then slipped back to R12.45 to the dollar on December 24, 2001 as liquidity was restored‚” she said.