South African rand weakens as Middle East conflict rattles investors

The South African rand weakened in early Monday trading as escalating Middle East tensions prompted a global flight to safe-haven assets. The currency fell about 1.4 percent to 16.16 per U.S. dollar, reflecting investor caution amid the conflict involving the United States, Israel, and Iran. The surge in geopolitical risk also boosted demand for gold, one of South Africa’s key exports, pushing prices to a four-week high.

ETM Analytics noted that despite U.S. President Donald Trump’s tariff policies undermining the dollar’s value, it remains a preferred refuge for investors seeking stability amid the recent volatility. Risk-sensitive emerging market currencies like the rand continue to respond to both global developments, particularly U.S. policy shifts, and domestic economic indicators. South Africa’s benchmark 2035 government bond also softened, with yields rising to 7.97 percent in early trade.

Credit : CGTN