By Tannur Anders
JOHANNESBURG (Reuters) -South Africa’s rand fell on Friday after U.S. President Donald Trump said he would cut off all federal funding to the country, while the dollar sagged after data showed the U.S. economy created fewer jobs than expected last month.
At 1519 GMT, the rand traded at 18.21 against the U.S. dollar, about 0.3% weaker than its previous close. It traded down about 1% earlier in the day.
This fall ends four consecutive daily gains for the local unit, but the currency still managed to appreciate almost 3% against the greenback since last Friday’s close as markets digested Trump’s tariff policies.
The dollar last traded about 0.5% weaker against a basket of currencies after data showed the U.S. economy created fewer jobs than expected in February, bolstering bets the Federal Reserve will cut interest rates this year.
Trump said in a post on Truth Social on Friday that the U.S. was stopping all federal funding to South Africa, adding that farmers seeking to flee South Africa over safety concerns will be invited into the U.S. with a rapid pathway to citizenship.
“This negative sentiment surrounding South Africa and Trump’s rhetoric continued to weigh on the rand,” said Wichard Cilliers, head of market risk at TreasuryONE.
Trump was likely referencing his claims last month that “South Africa is confiscating land and treating certain classes of people very badly”, alluding to a new law which aims to even out racial disparities in land ownership.
His administration also signed an executive order to cut U.S. financial assistance to South Africa last month, citing disapproval of its land policy and of its genocide case at the International Court of Justice against Washington’s ally Israel.
Like other risk-sensitive currencies, the rand often takes cues from global drivers like U.S. policy and economic data in addition to local factors.
South Africa’s net foreign reserves rose to $61.733 billion at the end of February from $61.328 billion in January, central bank data showed on Friday.
On the Johannesburg Stock Exchange, the blue-chip Top-40 index closed up about 0.3%.
South Africa’s benchmark 2030 government bond was little changed, with the yield at 9.07%.
(Reporting by Tannur Anders; editing by Janane Venkatraman and Mark Heinrich)
