JOHANNESBURG, July 11 (Reuters) - The South African rand fell against a firmer dollar on Friday as U.S. President Donald Trump's tariff threats kept markets on edge.
At 1432 GMT, the rand traded at 17.9450 against the dollar , more than 1% weaker than Thursday's close and in line with most of its emerging market peers as traders opted for safe haven assets. The U.S. dollar last traded about 0.3% stronger against a basket of currencies.
Johann Els, chief economist at Old Mutual, said the local unit was drifting mainly because of uncertainty over Trump's tariff policies.
"I think it's normal daily volatility ... but there's nothing to be concerned about," said Els, adding that the rand has yet to benefit from some investors turning to emerging markets because their faith in the dollar's reliability as a safe-haven currency has been shaken.
Domestically-focussed investors await updates from the government as it tries to negotiate a trade deal before an extended deadline of August 1, after which it faces a 30% trade tariff on its exports to the United States.
South Africa also faces an additional 10% tariff because of its membership in the BRICS group of developing nations that Trump has described as "anti-American".
This could further compound pressure on the already risk-sensitive rand, even as an ETM analytics research note said the currency was poised to benefit from an expected recovery in commodity prices.
"South Africa's terms of trade have improved courtesy of the buoyancy of gold and platinum prices and the recent surge in copper prices," ETM analytics said in the note.
"A study of commodity prices relative to the USD shows that the market is ripe for a USD correction and a recovery in commodity prices."
South Africa is a major producer of precious metals and its rand like other commodity-linked currencies will monitor tariff developments from Washington.
Next week, the statistics agency will release mining output and retail sales data that should provide clues on the health of Africa's most industrialised economy.
The Johannesburg Stock Exchange's Top-40 index was down 0.3%.
South Africa's benchmark 2035 government bond also fell, with the yield rising 12 basis points to 9.905%.
Reporting by Sfundo Parakozov; Editing by Andrew Heavens and Barbara Lewis
Source: Reuters