Rand slumps against dollar after upbeat US jobs data

Markets
The rand was markedly weaker against the dollar late on Friday as the greenback gained traction after the release of better-than-expected January United States nonfarm payrolls data.

JOHANNESBURG — The rand was markedly weaker against the dollar late on Friday as the greenback gained traction after the release of better-than-expected January United States nonfarm payrolls data.

US nonfarm payrolls grew by a seasonally adjusted 257 000 jobs in January, the US Labour Department said on Friday.

This upbeat jobs number was far better than market expectations of 237 000 new private-sector jobs.

The solid jobs report buoyed the dollar as it increased expectations that the US Federal Reserve might raise interest rates sooner than previously expected.

At 3:50pm, the rand was at R11,3963 to the dollar from Thursday’s close of R11,2875.

Against the euro, the local unit was at R12,9775 from a previous close of R12,9385 and was at R17,4210 against the British pound from a previous close of R17,2812.

The euro was at $1,1382 against the dollar from a close of $1,1470 on Thursday.

Job creation was also far stronger in prior months than previously estimated, with the US government upping its estimates of new jobs in November and December by a combined 147 000, Dow Jones Newswires reported.

“The dollar strengthened because of the better-than-expected US jobs number and because the previous number has been adjusted by so much as well, and that is why the rand is weaker,” a local trader said.

November marked the strongest month of private-sector hiring since 1997.

— BDLive