Service sector

South African rand plunges as dollar gains on US services sector data

youupdates prices to reflect afternoon trade

JOHANNESBURG, August 3 (Reuters)The South African rand gave up gains on Wednesday after the dollar rallied following a surprise rally in the U.S. services sector in July, supporting the view that the U.S. economy was not in good health. recession.

The Institute for Supply Management said its non-manufacturing PMI rebounded to 56.7 last month from 55.3 in June, ending three straight monthly declines.

The latest data erased gains made by the rand in the morning session after China’s response to US House Speaker Nancy Pelosi’s visit to Taiwan was not as severe that some in the financial markets had feared.

Pelosi’s visit has sparked increased tensions between the United States and China, which views Taiwan as a breakaway province, triggering a selloff in risk-sensitive currencies like the rand on Tuesday.

At 3:20 p.m. GMT, the South African currency ZAR=D3 was trading at 16.8575 to the dollar, around 0.12% lower than its previous close.

The dollar index =USDwhich tracks the currency against six major rivals, rose 0.28% to 106.74.

Separately, in a relatively light week for domestic economic data, a Purchasing Managers’ Index survey showed South African private sector activity rose for the third month in a row in July.

Shares on the Johannesburg Stock Exchange (JSE) ended slightly higher, helped by market heavyweights Naspers Ltd NPNJn.J and Prosus SA PRXJn.Jwhich ended respectively up 4.14% and 3.73%.

Overall on the JSE, the all-equity benchmark .JALSH closed up 0.89% at 68,611 points, while the premier index of the 40 largest companies .JTOPI ended up 0.99% at 62,199 points.

The South African Government’s 2030 Benchmark Bond ZAR2030= was lower, with yield up 5 basis points to 10.350%.

(Reporting by Alexander Winning and Bhargav Acharya Editing by Mark Potter, William Maclean)

((alexander.winning@tr.com))

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