JOHANNESBURG (Reuters) -South Africa’s rand hit its highest in nearly three months against the dollar on Thursday, which is struggling as President Donald Trump’s tariff policies fuel fears of a prolonged global trade war that could hit economic growth and fuel inflation.
The rand was at 18.1525 against the U.S. dollar by 1540 GMT, about 0.8% stronger than its previous close, and its highest level since mid-December.
The dollar index, which measures the greenback against six peers, was about 0.3% weaker.
Trump imposed 25% tariffs on imports from Canada and Mexico this week, but delayed tariffs for one month on some vehicles built in North America.
He also doubled duties on Chinese goods to 20%, adding to trade tensions with the three leading U.S. trading partners.
Like other risk-sensitive currencies, the rand often takes cues from global drivers in addition to local factors.
Data from the South African Reserve Bank on Thursday showed the country’s current account deficit narrowed in the fourth quarter of 2024 to 0.4% of gross domestic product from a revised 0.8% in the third quarter.
In rand terms, the current account deficit narrowed to 31.6 billion rand ($1.7 billion) in October-December, from a revised 55.6 billion rand in the previous three months.
On the Johannesburg Stock Exchange, the blue-chip Top-40 index closed up about 0.7%.
South Africa’s benchmark 2030 government bond was weaker, with the yield up 4.5 basis points to 9.075%.
($1 = 18.1546 rand)
(Reporting by Sfundo Parakozov and Tannur Anders;Editing by Eileen Soreng and Emelia Sithole-Matarise)
