South Africa's rand weakens vs dollar, trade data eyed

South African Reserve Bank Governor Gill Marcus smiles as she shows off South Africa's new banknotes before conducting the first transaction in Pretoria
South African Reserve Bank Governor Gill Marcus smiles as she shows off South Africa's banknotes, which features an image of former president Nelson Mandela on the front, November 6, 2012. REUTERS/Siphiwe Sibeko

JOHANNESBURG (Reuters) - South Africa's rand weakened against the dollar on Monday and weaker-than-expected trade data and the lack of a resolution to the debt ceiling impasse in the United States could put it under further pressure.

The rand was at 10.1450 to the dollar at 0651 GMT, down 0.7 percent from its close in New York on Friday.

It fell to a two-week low on Friday as members of the Association of Mineworkers and Construction Union (AMCU) began a strike at Anglo American Platinum's mines over planned job cuts.

The South African Revenue Service releases trade data for August at 1200 GMT. Economists polled by Reuters expect the trade gap to narrow to 12.5 billion rand, from 14.21 billion rand in July.

A disappointing reading is likely to fuel concerns about South Africa's large current account and budget deficits. It will also highlight the country's vulnerability to a slowdown in portfolio inflows should the U.S. Federal Reserve begin tapering its bond-buying programme this year.

In the United States, a shutdown of the government appears increasingly likely if policymakers fail to reach a deal on funding before the fiscal year ends at midnight on Monday. This could lead to a flight from risky assets such as the rand.

Strong U.S. non-farm payrolls data on Friday could also be negative for the rand.

"A buoyant U.S. payroll number could rekindle Fed tapering expectations, which would be positive for the dollar and negative for high-yielding emerging market currencies such as the rand," Absa Capital analysts wrote in a note.

Government bond yields declined marginally, falling 1.5 basis points on the 2026 issue to 7.98 percent and 2 basis points on the 2015 paper to 6.1 percent.