South African rand weakens against strong dollar

Source: Market Screener

JOHANNESBURG (Reuters) - South Africa's rand weakened in early trade on Friday against the U.S. dollar, which hovered near a five-month high as traders heavily scaled back bets for a slew of U.S. rate cuts this year.

At 0715 GMT, the rand traded at 18.7550 against the dollar, about 0.2% weaker than its previous close.

The dollar was trading up almost 0.4% against a basket of global currencies.

"The geopolitical risks in the Middle East remain high, and this is spurring further demand for the dollar," said Andre Cilliers, Currency Strategist at TreasuryONE, estimating that the rand would trade in an 18.65/18.90 range for the day.

There was some positive economic data this week to support the local currency, which has been battered by power cuts and political uncertainty ahead of a May election. South Africa's mining and manufacturing output rose in February, and business confidence held steady at an improved level.

On the stock market, the Top-40 index was up 0.88% while the broader all-share was up 0.78% in early trade.

South Africa's benchmark 2030 government bond was weaker in early deals, with the yield up 2.5 basis points to 10.715%.

(Reporting by Nellie Peyton; Editing by Tomasz Janowski)