Rand drops

Mixed denomination rand currency banknotes are arranged for a photograph at a First National Bank (FNB) branch in Johannesburg, South Africa, on Friday, March 15, 2013. A recovery in mining and manufacturing is giving South Africa's rand and bonds a breather amid concern that growth is slowing while inflation accelerates. Photographer: Nadine Hutton/Bloomberg via Getty Images

South Africa’s rand dipped yesterday after the country reported an unexpected trade deficit for September.

Following the release of the data, the rand extended its losses to trade more than 1.7 per cent lower against the dollar at R14.8435.

The country posted a widening trade deficit for September of R2.95bn ($202m) — compared to a surplus of R8.77bn in August. Economists polled by Reuters had expected another surplus of R4bn.

Emerging market countries with large current account deficits are vulnerable to currency depreciation in the face of a broad dollar resurgence that began in the second quarter of 2018. The trade balance forms an important component of the current account. — Financial Times.