UPDATE 1-South African rand slips as investors eye inflation data

(Updates prices as of 1520 GMT, adds trader comment to paragraph 7)

JOHANNESBURG, Oct 21 (Reuters) – South Africa’s rand slipped against a stronger dollar on Monday, as investor focus shifts towards local inflation figures due later this week.

At 1520 GMT, the risk-sensitive rand traded at 17.6425 against the dollar, about 0.3% weaker than its previous close.

The dollar index was last up about 0.4% against a basket of currencies.

On Wednesday, Statistics South Africa will release monthly inflation figures, which will provide further clues on the South African Reserve Bank’s (SARB) interest rate trajectory.

Analysts expect more disinflation in September after price pressures dipped in August, which paved the way for the central bank to cut its main lending rate by 25 basis points last month, the first interest rate cut in four years.

With inflation at its lowest level since April 2021, Kavir Surujhlal, junior sales trader at IG Group, said the market could be pricing in a further 25 basis points cut at the bank’s next policy meeting in November.

On the stock market, the Top-40 index closed 0.14% lower.

South Africa’s benchmark 2030 government bond was weaker, with the yield up 6.5 basis points to 9.345%.

(Reporting by Bhargav Acharya and Tannur Anders; Editing by Ros Russell)

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