Rand loses ground as dollar firms on weak German data

The dollar will rise as long as the Fed reacts in a “normal” way to higher inflation from more expensive imports and to a “further heating up of the US economy” due to substitution of imports by domestic products, Dow Jones Newswires reports.

The pound fell to its lowest in 11 months against the dollar on Monday as concerns the UK could exit the EU without a deal outweigh last week’s Bank of England (BOE) interest-rate increase.

On Friday, BOE governor Mark Carney said the risks of a no-deal Brexit were “uncomfortably high”, while UK international trade secretary Liam Fox told Britain’s Sunday Times there was a 60% chance of Brexit talks ending without a deal.

“The pound is very vulnerable to political uncertainty,” Rabobank analysts said.

At 2.55pm, the rand was at R13.4422 to the dollar, from R13.3346. It was at R15.5144 to the euro from R15.4285, and at R17.3737 to the pound from R17.3491.

The euro was at $1.1542 from $1.157 and the pound was at $1.2925 from $1.301.

Local bonds were weaker with the R186 bid at 8.73% from 8.685%.

The US 10-year treasury was last seen at 2.9455% from 2.9492%.