South African Rand Rises as US Dollar Weakens on Jobs Data

The South African rand gained ground against the U.S. dollar on Thursday, trading 1.0% stronger than its previous close. By 1244 GMT, the currency was valued at 16.24 to the dollar.

The rand's appreciation was primarily driven by a weakening U.S. dollar. The dollar index, which measures the greenback against a basket of major currencies, fell by approximately 0.6% following the release of weaker-than-expected American employment data.

According to the report, U.S. nonfarm payrolls increased by only 57,000 in June, significantly missing economists' forecasts for a 110,000 gain. The report did note, however, that the national unemployment rate decreased slightly to 4.2% from 4.3%.

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In the absence of major local economic data, the rand often follows global market drivers. The positive sentiment was also reflected in the Johannesburg Stock Exchange, where the Top-40 index rose by about 1.5%.

Other global factors also influenced markets. Oil prices dropped nearly 2% after Qatar reported progress in discussions between the U.S. and Iran regarding the Strait of Hormuz.