Market News

Sfundo Parakozov

JOHANNESBURG, Dec 9 (Reuters) – South Africa’s rand traded flat on Tuesday after the government issued its first infrastructure and development finance bonds, and ahead of this week’s U.S. Federal Reserve’s policy meeting.

At 1258 GMT, the rand traded at 17.06 against the dollar, little changed from its previous closing level.

The National Treasury said the sale of 10-year and 15-year instruments raised 11.795 billion rand ($693 million). It hopes the projects funded by the sale will help drive higher economic growth and improve service delivery.

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The bonds are part of a broader plan to allocate more than 1 trillion rand to public infrastructure over the next three years in Africa’s biggest economy.

The greenback, was flat against a basket of currencies as investors positioned for an expected December Fed rate cut and looked for signs of whether policymakers will outline a slower easing path.

“Market uncertainties surrounding the Federal Reserve’s upcoming interest rate decisions have added to the pressure on the ZAR, as investors also anticipate key US economic data that could influence the pace of future cuts,” ETM Analytics said.

Domestically-focused traders will keep tabs on retail sales data on Wednesday along with mining and manufacturing production figures on Thursday.

On the Johannesburg Stock Exchange, the Top-40 index was last down 0.3%.

South Africa’s benchmark 2035 government bond also weakened, as the yield rose 5.5 basis points to 8.51%.