Rand touched fresh four-year lows against dollar as mining strife weighed on sentiment.

The rand touched fresh four-year lows against the dollar on Friday and could weaken further towards technical support at R9.50 as labour strife in the mine sector weighs on sentiment.

The rand fell more than 1.2 percent to R9.4410 a dollar early in the session, the weakest it has been since April 2009, as tensions simmered at Anglo American Platinum over its plan to axe 6 000 jobs.

By 5pm on Friday the currency was bid at R9.3879 to the dollar, 10.77c weaker than the same time on Thursday.

“We have recovered marginally from the worst levels of the day [due to] slightly greater interest this afternoon from some dollar sellers perhaps squaring up for the weekend, but overall the rand hasn’t performed well,” Nedbank trader William van Rijn said.

Investors are still worried that a recent spate of strikes in the mining sector could spark violence similar to that in which more than 50 people were killed last year.

The violence has dented sentiment toward South African assets, contributing towards a 9 percent tumble in the rand’s value against the greenback since the beginning of this year.

“Unfortunately any sort of industrial action in South Africa of late, especially in the mining sector, has led to a certain degree of bloodshed and that translates into a great degree of discomfort in the market,” Van Rijn added. – Reuters

The dollar eased in Asia on Monday after a Japanese minister said the recent correction against the yen was nearly over.

Hong Kong - The dollar eased in Asia on Monday after a Japanese minister said the recent correction against the yen was nearly over, but analysts said the greenback would soon resume its climb.

The dollar was changing hands at 102.69 yen in Tokyo afternoon trade, down from 103.19 yen in New York late on Friday, but still up from the lower 102-yen range seen before the Tokyo market closed on Friday.

The euro was quoted at $1.2841 and 131.86 yen against $1.2834 and 132.44 yen in US trade.

The dollar was supported at 102.60 yen and could test 104 yen in the short-term after breaching 103 yen late Friday, said Citibank Japan chief forex strategist Osamu Takashima.

The greenback dipped early on Monday after Economy, Trade and Industry Minister Akira Amari on Sunday suggested the Japanese government may not want the yen to weaken further.

Responding to a question on how far the unit should fall, Amari said: “It's being said that the correction of the strong yen is largely completed. If the yen keeps on weakening a lot more, it will have a negative impact on peoples' lives (by pushing up import costs).”

His comment came after the dollar rose past the 103-yen mark for the first time in more than four years late on Friday, making a three-percent gain in the past week alone and a 30-percent rise since mid-November.

The yen started tumbling in December after Prime Minister Shinzo Abe launched his successful campaign for office on a pro-spending, weak-yen platform. Recent solid data on the US economy fuelled the dollar's ascent.

Daisaku Ueno, senior forex strategist at Mitsubishi UFJ Morgan Stanley, said the dollar fell early on Monday as some traders used Amari's comments as “an excuse to take profits after the dollar breached 103 yen”.

The dollar was mixed against other Asia-Pacific currencies.

It fell to Sg$1.2551 on Monday afternoon from Sg$1.2564 Friday afternoon, to 9,770 Indonesian rupiah from 9,798 rupiah and to 1,117.15 South Korean won from 1,117.36 won.

The US unit rose to 55.01 Indian rupees from 54.91 rupees and to 29.87 Thai baht from 29.81 baht while holding steady at Tw$29.96 and at 41.21 Philippine pesos.

The Australian dollar firmed to 97.76 US cents from 97.48 cents while the Chinese yuan changed hands at 16.69 yen against 16.66 yen. - AFP

The rand weakened to a four-year low against the dollar, extending its longest losing streak in a year.

Cape Town - The rand weakened to a four-year low against the dollar, extending its longest losing streak in a year on concern that renewed labor unrest and falling commodity prices will weigh on South Africa’s economy.

The situation at the nation’s mines, which contribute more than half of South Africa’s export earnings, is “quite volatile,” Cyril Ramaphosa, deputy president of the ruling African National Congress, said today.

Violent protests cost mines 15 billion rand ($1.6 billion) in lost revenue last year and contributed to the rand’s 5.6 percent slide in the past six months.

The dollar strengthened against all 16 major peers this week on speculation the US Federal Reserve may end monetary easing that has weakened the currency.

“There is no doubt that the stories and rumours of strikes and union violence are the key factor of intraday volatility,” John Cairns, a currency strategist at Rand Merchant Bank in Johannesburg, said in e-mailed comments.

“Threats that the Fed could bring an early end to its quantitative-easing program” are driving the rand’s declining trend, he said.

South Africa’s currency depreciated as much as 1.2 percent to 9.4327 per dollar, the weakest level since April 2009.

It traded 1.1 percent down at 9.4202 as of 9:25 a.m. in Johannesburg for a seventh straight day of declines, the longest streak since the nine days ending May 18, 2012.

The currency has depreciated 3.2 percent this week.

Yields on benchmark 10.5 percent bonds due December 2026 rose two basis points or 0.02 percentage point, to 6.85 percent.

Union Plans

The Association of Mineworkers and Construction Union, known as AMCU, is planning a march to government offices in Pretoria to protest against intimidation at mines.

It hasn’t set a date for the march, Treasurer Jimmy Gama said.

The National Union of Mineworkers has vowed to oppose plans by Anglo American Platinum to shut shafts and cut 6,000 jobs as metal-prices fall and costs rise.

Labor unions “fighting for turf” are adding to instability at mines, Ramaphosa said in an interview on Johannesburg-based Talk Radio 702.

He called on unions and mining companies to hold talks to resolve disputes.

The dollar rose toward a six-week high against the euro before the Fed releases on May 22 minutes of its last meeting, when policy makers said they may alter the pace of monthly bond purchases.

Fed Bank of San Francisco President John Williams said yesterday the central bank may begin to taper off buying as early as this summer. - Bloomberg News

The rand tumbled to a four-year low, extending its longest losing streak in 12 months.

Cape Town - The rand tumbled to a four-year low, extending its longest losing streak in 12 months, on concern that falling metal prices and labor unrest are threatening the nation’s credit rating and economic growth.

South Africa’s rating outlook remains negative and mining strikes may hurt the economy, Moody’s Investors Service said yesterday.

The Standard & Poor’s GSCI Index of raw materials dropped for a fifth day as metals, including gold and platinum, declined.

The nation is the world’s fifth-largest gold producer and has the largest platinum reserves.

Workers at Anglo American Platinum, the largest producer, threatened to strike if the company doesn’t reverse a plan to cut 6,000 jobs.

“There’s still some tension at the mines,” David Gracey, head of currency and derivatives trading at Investec Ltd., said by phone from Cape Town.

“Gold is getting hammered.”

South Africa’s currency depreciated as much as 1.4 percent to 9.3836 per dollar, the weakest level since April 2009.

It traded 0.7 percent down at 9.3229 by 3:11 p.m. in Johannesburg, a sixth straight day of losses.

Yields on benchmark 10.5 percent bonds due December 2026 rose four basis points, or 0.04 percentage point to 6.86 percent, the highest on a closing basis since April 25.

Employees at Lonmin Plc’s Marikana mine returned to work late yesterday after a two-day illegal strike, the company said today.

Rivalry between two labor unions that led to the strike will persist and may cause disruptions at other mines, according to Brigid Taylor, head of institutional flow sales at Nedbank Group Ltd. in Johannesburg.

‘Shaken Industry’

Labor disputes have “shaken the industry and tarnished South Africa’s image as a major international mining investment destination,” Taylor said in e-mailed comments.

“The market has not fully priced in the risk of another credit rating downgrade.”

If the strikes aren’t contained, it could weigh on South Africa’s credit rating, Fitch Ratings analyst Carmen Altenkirch told the Johannesburg-based Business Day newspaper on May 14.

The rand has lost 12 percent against the dollar since Moody’s cut the rating by one level to Baa1 on September 27.

New York-based Standard & Poor’s lowered South Africa by the same magnitude to BBB on October 12, while Fitch followed on January 10.

Moody’s and S&P kept a negative outlook on the rating.

Metals and other commodities accounted for 53 percent of South Africa’s exports in 2012, according to government data.

The nation mines 77 percent of the world’s platinum, and is the fifth-biggest gold producer.

The rand’s three-month implied volatility against the dollar has climbed 40 basis points in the past two days to 12.82 percent, indicating that options traders see wider swings in the currency in coming months.

Foreign investors were net sellers of 222 million rand ($24 million) of South African bonds yesterday, according to the JSE Ltd., which runs the nation’s stocks and bond exchanges. - Bloomberg News

The rand weakened for a sixth day, set for its longest losing streak in a year, on concern about the nation’s credit rating.

Cape Town - South Africa’s rand weakened for a sixth day, set for its longest losing streak in a year, on concern that falling commodity prices and labor unrest at mines are threatening the nation’s credit rating.

South Africa’s rating outlook remains negative and mining strikes may hurt the economic growth outlook, Moody’s Investors Service said yesterday.

The Standard & Poor’s GSCI Index of raw materials dropped for a fifth day as metals including gold and platinum declined.

Metals and other commodities account for more than half of South Africa’s exports.

“There’s still some tension at the mines, and gold is getting hammered,” David Gracey, head of currency and derivatives trading at Investec Ltd., said by phone from Cape Town.

“It’s a dollar-buying story.”

South Africa’s currency depreciated as much as 1.1 percent to 9.3582 per dollar, the weakest level since March 22.

It traded 0.8 percent down at 9.3294 per dollar by 11:37 a.m. in Johannesburg, bringing its retreat in the past six trading days to 3.5 percent.

Yields on benchmark 10.5 percent bonds due December 2026 rose three basis points, or 0.03 percentage point to 6.85 percent.

Employees at Lonmin’s Marikana mine returned to work late yesterday after a two-day illegal strike, the company said today.

Rivalry between two labor unions that led to the strike will persist and may cause disruptions at other mines, according to Brigid Taylor, head of institutional flow sales at Nedbank in Johannesburg.

Tarnished Image

“The workers’ return is not the end of the industrial action, which has shaken the industry and tarnished South Africa’s image as a major international mining investment destination,” Taylor said in e-mailed comments.

“The market has not fully priced in the risk of another credit rating downgrade.”

If the strikes aren’t contained, it could weigh on South Africa’s credit rating, Fitch Ratings analyst Carmen Altenkirch told the Johannesburg-based Business Day newspaper on May 14.

The rand has lost 12 percent against the dollar since Moody’s cut the rating by one level to Baa1 on September 27.

New York-based Standard & Poor’s lowered South Africa by the same magnitude to BBB on October 12, while Fitch followed on January 10. Moody’s and S&P kept a negative outlook on the rating.

The rand’s three-month implied volatility against the dollar has climbed 40 basis points in the past two days to 12.82 percent, indicating that options traders see wider swings in the currency in coming months. - Bloomberg News

The dollar slipped against the yen in Asia on Thursday as investors locked in profits on the greenback's recent surge.

Tokyo - The dollar slipped against the yen in Asia on Thursday as investors locked in profits on the greenback's recent surge, while the euro was weak on gloomy European growth data.

The currency market's reaction to upbeat Japan economic growth data was muted despite figures showing the world's third-largest economy expanded 0.9 percent between January and March from the previous three months.

In morning Tokyo trade, the dollar bought 102.05 yen, briefly falling below the 102-yen mark and down from 102.23 yen in New York late on Wednesday. However, the greenback was still trading well above the 98-yen range a week ago.

The euro also weakened against the Japanese currency and was at 131.37 yen from 131.72 yen in US trade, while it slipped to $1.2875 from $1.2884.

“Today's moderate setback (in the dollar) is due to cautious sentiment among players as they adjust their trading positions after the dollar surged so fast,” said Yosuke Hosokawa, senior dealer with Sumitomo Mitsui Trust Bank.

“But the overall dollar-buying trend has yet to change.”

Japanese stocks have surged since December as the yen plunged with the government pushing for active spending and the Bank of Japan carrying out massive monetary easing, which tends to weigh on the currency.

Thursday's solid GDP data briefly triggered yen selling as investors remained convinced Tokyo would keep its easy-money policies in place, but the data's overall impact was limited, Hosokawa said.

The euro was weak after official figures showed the eurozone economy shrank 0.2 percent between January and March, the sixth consecutive quarterly contraction and marking the longest recession since the bloc was established in 1999. - Sapa-AFP

The rand fell to a three-week low against the dollar, dragged down by fears that a strike at platinum miner Lonmin could result in a repeat of the industrial unrest that hit South Africa's economy last year.

Johannesburg - The rand fell to a three-week low against the dollar on Wednesday, dragged down by fears that a strike at platinum miner Lonmin could result in a repeat of the industrial unrest that hit South Africa's economy last year.

The rand weakened to 9.2540 to the dollar, its softest since April 23. It closed at 9.2350 in New York on Tuesday.

Workers at Lonmin's Rustenburg and Marikana mines were on strike for the second day on Wednesday, halting production at all 13 shafts of the world's third-biggest platinum producer.

South Africa's platinum belt, which saw violent strikes last year including the police killing of 34 miners on a single day in August, is a flashpoint of labour strife, with tensions running high over looming job cuts and wage talks.

“This has reminded investors that the currency remains vulnerable to portfolio flows,” said Christopher Shiells, emerging market analyst at Informa Global Markets.

“We see dollar/rand perhaps testing the late April high above 9.3000.”

Yields on government bonds were up three basis points to 6.825 percent on the benchmark 2026 issue, equalling Tuesday's two-week high. - Reuters

The rand fell to a three-week low and bond yields jumped the most since October as a strike at a Lonmin mine sparked concern.

Cape Town - The rand fell to a three-week low and bond yields jumped the most since October as a strike at a Lonmin Plc mine sparked concern of renewed labor unrest in an industry that produces more than half of South Africa’s exports.

Shares in South African platinum-mining companies, which account for 77 percent of the world’s output, plunged as operations came to a halt at all 13 shafts of Lonmin’s Marikana mine after a labor union official was killed on May 11, spokeswoman Sue Vey said. Violent strikes that started at Lonmin last year cost South African miners as much as 15 billion rand ($1.6 billion) in revenue and contributed to the currency’s 5.1 percent slide in December.

“Labor issues are the driving factor behind the rand’s decline today,” Mohammed Nalla, head of strategic research at Nedbank Group Ltd. in Johannesburg, said by phone. “If you look at what is happening with the stocks today, there is a massive sell-off and some of that has to work through to the rand.”

South Africa’s currency declined as much as 0.8 percent to 9.2319 per dollar, the weakest since April 23. It traded 0.7 percent down at 9.2210 by 1 p.m. in Johannesburg, bringing its decline this year to 8.1 percent, the worst out of 25 emerging- market currencies monitored by Bloomberg. Yields on benchmark 10.5 percent bonds due December 2026 climbed 11 basis points, or 0.11 percentage point, to 6.81 percent, the highest since April 26.

The latest unrest at the mine near Rustenburg, 120 kilometres (75 miles) northwest of Johannesburg, comes after the Association of Mineworkers and Construction Union said a local organiser was shot dead. Competition over membership between the National Union of Mineworkers and AMCU is intensifying before annual wage talks.

More Disruptions

Violence at the mine in August that erupted from a dispute over pay left 44 people dead, 70 injured and led to about 250 arrests. President Jacob Zuma appointed a commission of inquiry to investigate.

The Lonmin strike could be a “thorn in the rand’s side,” George Glynos, a Johannesburg-based analyst at ETM Analytics, said in e-mailed comments. “Given the backdrop of the impact strike activity had last year, this is unwelcome news. Investors should prepare themselves for more disruptions from the unions.”

Shares in Lonmin, the third-biggest platinum producer, plunged as much as 8.1 percent. Anglo American Platinum Ltd., the biggest producer, fell as much as 5.2 percent, while Impala Platinum Holdings Ltd. dropped 8.4 percent.

Platinum and other mining commodities accounted for 53 percent of South Africa’s export earnings in 2012, according to government data. - Bloomberg News

The rand depreciated for a fourth day and bond yields jumped after a strike at a Lonmin mine sparked concern of renewed.

Cape Town - The rand depreciated for a fourth day and bond yields jumped after a strike at a Lonmin Plc mine sparked concern of renewed labor unrest in an industry that accounts for more than half of South Africa’s exports.

Operations were suspended at all 13 shafts of Lonmin’s Marikana platinum mine after a labor union official was killed on May 11, spokeswoman Sue Vey said today.

Violent strikes that started at Lonmin last year cost South African miners as much as 15 billion rand ($1.6 billion) in revenue and contributed to the rand’s 5.1 percent slide in December.

The Lonmin strike could be a “thorn in the rand’s side today,” George Glynos, a Johannesburg-based analyst at ETM Analytics, said in e-mailed comments.

“Given the backdrop of the impact strike activity had last year, this is unwelcome news. Investors should prepare themselves for more disruptions from the unions.”

South Africa’s currency declined as much as 0.3 percent and traded 0.1 percent weaker at 9.1671 per dollar as of 8:40 a.m. in Johannesburg.

Yields on benchmark 10.5 percent bonds due December 2026 climbed five basis points, or 0.05 percentage point, to 6.76 percent, the highest since April 29. - Bloomberg News

The rand gained for the first time in three days as investors gauged the currency’s retreat to a two-week low was overdone.

Cape Town - The rand gained for the first time in three days as investors gauged the South African currency’s retreat to a two-week low was overdone.

The rand depreciated 2.4 percent last week and 1.1 percent on May 10 after planned job cuts by the nation’s biggest platinum miner sparked concern of renewed labor unrest and amid speculation the central bank will cut interest rates next week to counter slowing growth.

A technical signal suggested the decline had gone too far.

“The rand is still edgy but should be able to stabilise after Friday’s sharp losses,” John Cairns, a currency strategist at Rand Merchant Bank in Johannesburg, said in e-mailed comments.

“Risks for the week remain large.”

The rand appreciated 0.3 percent to 9.0967 per dollar as of 11:04 a.m. in Johannesburg after retreating as much as 0.4 percent earlier to 9.1552, the weakest level since April 26.

Yields on benchmark 10.5 percent bonds due December 2026 rose three basis points, or 0.03 percentage point, to 6.71 percent.

The stochastic oscillator for the rand versus the dollar rose last week above the 70 threshold that signals the currency may have depreciated too quickly and is poised for a rally.

The measure, which tracks the price of a currency relative to its highs and lows during a particular period, had been above 70 from May 8 to May 10. It dropped to 67 today.

Mining Strikes

The National Union of Mineworkers said on May 10 it was prepared to strike against plans by Anglo American Platinum Ltd. to dismiss as many as 6,000 workers as it closes three shafts at its South African mines.

Violent strikes last year cost South African miners as much as 15 billion rand ($1.7 billion) in revenue and contributed to the currency’s 5.1 percent slide in December.

Retail sales growth in Africa’s biggest economy slowed to 2.4 percent in the year through March from 3.8 percent the previous month, a report may show on May 15, according to the median estimate of 15 economists in a Bloomberg survey.

A slowdown may spur the central bank to lower borrowing costs as soon as next week, Charles Robertson, chief economist at Renaissance Capital Ltd. in London, said by phone on May 10. - Bloomberg News