June 5, 2019 / 9:37 AM / 3 months ago

South African rand volatility gauge touches near 2-month high

LONDON, June 5 (Reuters) - A South African rand volatility gauge touched a near two-month high on Wednesday, as the currency remained under pressure from dire economic data and a fierce debate over the central bank’s mandate.

One-month implied volatility hit 14.65 vols, the highest level since April 10, before easing back to stand at 1-month high of 14.5 vols.

Data out on Tuesday showed the continent’s most industrialised economy had suffered it worst quarterly contraction in a decade at the start of the year.

The rand is also reeling from news that South Africa’s ruling party is arguing over whether to change the central bank’s mandate to include employment and growth as well as inflation. Investors are wary of any changes that could curb the prized independence of the bank. (Reporting by Marc Jones, editing by Karin Strohecker)

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