JOHANNESBURG (Reuters) – South Africa’s rand weakened in early trade on Thursday ahead of President Jacob Zuma’s annual state of the nation address, which investors hope will tackle domestic economic woes including electricity shortage.
At 0704 GMT the rand was trading 0.22 percent softer at 11.8615 to the dollar, compared to its closing level of 11.8350 on Wednesday.
The currency touched a 12-year low of 11.8925 on Wednesday after long-standing economic frailties and more immediate socio political pressures turned sentiment against the unit.
Power supplier Eskom on Wednesday implemented rolling blackouts, locally known as load shedding, for a 10th straight day after technical problems on its aging units cut capacity.
Global risk sentiment was rattled on Wednesday, sending emerging currencies lower, as a meeting of euro zone finance ministers in Brussels showed little sign of reaching agreement on terms of Greece’s bailout.
“With Greek talks not going anywhere, other risk currencies selling off, Eskom’s woes and the unedifying spectacle of the local state of the nation address coming up, it’s easy to think a decisive break higher is coming,” RMB currency analyst John Cairns said in a note.
Government bonds also weakened, with the yield for the 2026 benchmark up 0.5 basis points to 7.625 percent.
