The South African rand weakened in early trading on Tuesday as investors awaited second-quarter economic growth data expected to show that Africa’s most industrialised economy contracted.
At 0625 GMT, the rand traded at 16.0375 per dollar, about 0.2% weaker than its previous close.
Statistics South Africa is scheduled to release second-quarter gross domestic product (GDP) figures at 0900 GMT, giving investors and policymakers fresh insight into the strength of the economy.
Economists polled by Reuters expect the economy to have contracted 0.1% quarter-on-quarter, following growth of 0.5% in the first quarter of 2026. Annual growth is forecast at 1.2%.
ETM Analytics said such an outcome would bring an end to six consecutive quarters of economic expansion, although the headline figure could mask weaker underlying momentum.
Nedbank economists expect a slightly larger 0.2% contraction, pointing to weakness in mining, manufacturing, electricity, gas and water, as well as domestic trade.
Agriculture and parts of the services sector are expected to have provided some support to economic activity during the quarter.
South African government bonds also weakened in early trading. The benchmark 2035 government bond yield rose 4 basis points to 8.615%, reflecting cautious investor sentiment ahead of the GDP release.
Market Snapshot
– Rand: 16.0375 per dollar, down 0.2%
– Q2 GDP forecast: -0.1% quarter-on-quarter
– Q1 GDP growth: 0.5%
– 2026 annual growth forecast: 1.2%
– 2035 government bond yield: 8.615%, up 4 basis points
Source: Reuters
Reporting: Sfundo Parakozov
Editing: Mark Potter
