Futures Market News
Rand heads toward worst weekly performance of year following Greek turmoil
May 11, 2012 02:27 PM
Uncertainty in debt-riddled Greece dragged down the South African rand to its lowest value in nearly four months on Friday as the monetary unit drove toward its poorest weekly showing thus far in 2012, Bloomberg reports.
The monetary unit of the largest economy of the African continent fell as the Aegean nation continues to avoid defaulting on loan obligations. Following last weekend's election that left no clear victor, Greece also is in peril of removal from the euro currency bloc. Whether the country will adhere to austerity measure commitments also is unclear and causing panic.
"The prevailing uncertainty will continue to weigh on the euro and other risky assets, while continuing to lend support to the dollar. Therefore, the rand's weakening bias will persist into the weekend," according to an email to Bloomberg by currency strategist Nomvuyo Guma with Standard Bank Group in Johannesburg.
The nations of the euro zone purchase more than 20 percent of exports from South Africa, making the African nation sensitive to regional developments and challenges.
For the second consecutive week on Friday, South Africa did not encounter strong results during an inflation-linked bond sale, according to Reuters.
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