South African Rand Flat as US Job Report Fuels Dollar Rally
The South African rand is trading flat against crosses on Monday as a surprise US May jobs report fueled a broad dollar rally and crushed emerging-market currencies.
The local unit is changing hands at R16.54 to the US dollar, R19.07 to the euro and R22.06 to the British pound, First National Bank (FNB) said in a brief on Monday.
The US labour market delivered a major upside surprise in May, with non-farm payrolls (which exclude farm, household and active-duty military workers) rising by 172 000, double the consensus forecast of 85 000, and higher than the upwardly revised net gain of 93 000 jobs in the previous two months.
The report shows that the headline unemployment rate held steady at 4.3% for a third consecutive month, matching market expectations, as the number of unemployed fell by 66 000 to 7.3 million and total employment rose by 149 000 to 162.8 million.
The labour force participation rate was unchanged at 61.8%, the lowest since October 2021, while the employment rate edged up to 59.2%.
The report indicates that US wage growth remained firm, with average hourly earnings up 0.3% month-on-month and 3.4% year-on-year.
Hence, the dollar index strengthened toward 100 as demand for the greenback increased amid escalating geopolitical tensions. The renewed attacks in the Middle East drove crude oil prices higher while Gold slipped.
Oil prices are trading higher, underpinned by the ongoing US blockade of Iran, which drove OPEC output to its lowest level in at least 37 years in May.
Market analysts noted that Iran accounted for more than half of the 1.22 million barrels per day decline. Brent crude oil is trading at $97.11/barrel, and WTI is hovering around $91.
The bullion weakened sharply, erasing all its 2026 gains after Friday’s US May non-farm payrolls print reignited fears of Federal Reserve rate hikes and drove a surge in US Treasury yields amid a stronger dollar, both of which are direct headwinds for the non-yielding metal. Gold is trading at $4 313/ounce.
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