South African Rand Falls After Sixth Consecutive Mining Output Decline

The South African rand experienced fluctuations last week amid disappointing local economic data and global market influences. After a brief strengthening early in the week, buoyed by optimism over a local budget vote and a weaker U.S. dollar, the rand slipped following the release of weaker-than-expected mining output figures, which showed a 7.7% year-on-year decline in April, worse than the anticipated 4.3% drop. This decline was largely driven by reduced production of platinum group metals, a significant component of South Africa's mining sector. Meanwhile, manufacturing output also contracted sharply by 6.3% year on year in April, marking the sixth consecutive monthly decline and contributing to sluggish economic growth. Global factors, including cautious U.S.-China trade talks and shifts in U.S. inflation data, influenced investor sentiment, with the rand reacting to these external signals alongside domestic economic challenges. South Africa's benchmark 2035 government bond yields fluctuated modestly during this period, reflecting mixed investor confidence amid ongoing economic uncertainty.