January 7, 2015 / 7:10 AM / 4 years ago

South Africa's rand weakens as oil price tumble fuels investor jitters

A South African child holds a 50 rand in a file photo.

JOHANNESBURG (Reuters) - South Africa’s rand weakened against the U.S. dollar early on Wednesday as falling global oil prices, down 10 percent in the past two days, and worries over global growth prospects soured confidence in emerging market assets.

At 0600 GMT the rand traded at 11.7275 per dollar, 0.11 percent softer following an overnight close of 11.7150 in New York, the currency failing to confirm stops near the 11.6800 resistance level.

Government bonds continued to be firm as investors sought safer bets in fixed income, with the yield on the benchmark paper due in 2026 shedding 3.5 basis points to a month-low of 7.755 percent.

Russia’s rouble led the slide in emerging market currencies, falling by over 4 percent as the price of brent crude eased another 17 cents to $50.93 a barrel.

Euro zone inflation data due later in the session is expected to show a fall in prices across the region, while a Reuters poll predicts Chinese GDP will slow to its weakest since 2009, as economies globally continue to struggle and fuel uncertainty.

Locally, South Africa’s vehicle industry publishes new car sales data for December at 0900 GMT.

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