South Africa's rand weakens after ECB unveils details of stimulus plan

JOHANNESBURG: South Africa's rand weakened against the U.S. dollar on Thursday as the European Central Bank's announcement detailing its $1 trillion bond buying programme failed to halt the greenback's strong run.

At 1620 GMT the rand had softened 0.3 percent to 11.8285 per dollar in volatile trade. It earlier gained close to 0.5 percent to 11.7300, its strongest level in a week, after the ECB's announcement.

The dollar index showed the greenback maintaining its positive run as it chalked up 0.44 percent against a basket of major currencies, with the euro a major loser, down 0.51 percent .

With no local data releases, market attention was squarely focused on the ECB's policy meeting in Cyprus where the bank said it would begin its 60 billion euro ($66 billion) a month quantitative easing program from Monday.

Local bonds were subdued and hardly moved on the QE details, with the yield on the highly-traded instrument due in 2026 shedding 1.5 basis points to 7.745 percent.

"This cheap, easy money may be the saviour of global EM bond markets that have been under pressure of late," said Deon Kohlmeyer of Rand Merchant Bank in a market note. "However, the ECB has a history of talking a good story without much follow through."

U.S. non-farm payrolls data is likely to provide most market direction on Friday, with only monthly foreign exchange reserves published by the central bank data at 0600 GMT expected locally.