JOHANNESBURG, Sept 21 (Reuters) - The South African rand
fell to more than three-week lows on Tuesday, hurt by subdued
risk appetite and after ratings agency Fitch said Africa's most
industrialized economy will continue to face challenges as it
seeks to stabilize debt.
At 1500 GMT, the rand was trading at 14.8730 against
the dollar, 0.6% weaker than its previous close.
The currency has been hit this week by the fallout
especially on emerging markets from Chinese property firm
Evergrande's debt debacle, a rout in commodity prices
and a stronger dollar.
On Tuesday, Fitch said even though stronger-than-expected
fiscal revenue in recent months meant that South Africa's budget
deficit will be smaller than earlier Treasury projections, the
government would still face challenges to stabilize
Affirming South Africa's rating at BB-with a negative
outlook in May, Fitch indicated that progress on fiscal
consolidation that boosts confidence that government debt/GDP
stabilization would be achieved could be a trigger for positive
"However, even if the deficit is lower than anticipated in
FY21/22, it is unclear whether this outperformance will be
sustained," Fitch said in Tuesday's statement, adding that
notably, mining revenue will slow as commodity prices becomes
Looking ahead, the U.S. Federal Reserve meeting due to
conclude on Wednesday will be critical for all emerging market
currencies as a tapering of its stimulus measures would likely
prompt a flight of capital to the dollar.
The South African Reserve Bank's monetary policy meeting on
Sept. 23 will also be a key event for the local currency.
Stocks rose, rebounding alongside commodity prices after the
previous day's heavy selling.
The Johannesburg Stock Exchange's Top-40 Index
climbed 1.5% to 56,086 points and the broader All-Share Index
was up by almost the same amount to 62,362 points.
Among the biggest gainers of the day on the blue-chip index
were petrochemicals producer Sasol and gold miner
AngloGold Ashanti, both up around 4.5%.
In fixed income, the yield on the government bond due in
2030 was up a single basis point to 9.065%.
(Reporting by Promit Mukherjee and Olivia Kumwenda-Mtambo;
Editing by Emelia Sithole-Matarise)