South African rand softer, month-end import pressure seen

JOHANNESBURG (Reuters) - South Africa's rand was softer against the dollar in early Monday trade, retreating a few cents after Reserve Bank data showed growth in credit extension to the private sector slowed again in June.

The data backs the case for the Reserve Bank to consider another interest rate cut - rates have been steady since the last reduction in 2012 - to boost consumer demand and spur economic growth.

By 0645 GMT the rand was at 9.8200 against the dollar, down 0.55 percent from its New York close at 9.7660 on Friday.

The rand could extend losses as importers make their usual end-of-month external payments.

"Today is the usual month-end corporate activity day and therefore we do expect a bit more from the demand side of the market, from a local perspective that is," Standard Bank trader Warrick Butler said.

The rand pulled back from 9.7950 just before a Reserve Bank report released at 0600 GMT showed that growth in credit demand from the private sector slowed to 8.91 percent year-on-year in June from 9.05 percent in May.

Government bonds were little changed from Friday levels, with the yields for the benchmark issue due in 2026 and the 2015 paper each edging up half a basis point to 8.175 percent and 6.2 percent respectively. (Reporting by Stella Mapenzauswa; editing by David Dolan)

Source: http://news.yahoo.com/south-african-rand-softer-month-end-import-pressure-065350984.html

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