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South African rand falls as gold prices weigh

The rand of South Africa fell against the dollar Tuesday as risk sentiment increased following Donald Trump's decision not to impose tariffs on Europe.

At 1510 GMT the commodity-backed currency of the country traded at 17,8900 per dollar, down about 0.2% from its previous closing.

The Top-40 index on the stock exchange was flat, with mining companies facing pressure due to the drop in gold prices of more than 1%.

Gold Fields, AngloGold Ashanti, and Sibanye Stillwater are all South African mining companies that traded lower for most of the trading session on Tuesday.

Shares of Harmony Gold fell even more after the company announced that it had agreed to purchase Mac Copper Ltd, an Australian miner, in a $1.03 billion deal.

Investors in the United States will be focused on this week's central bank interest rate announcement.

Economists surveyed by predict that the South African Reserve Bank will cut its main rate of interest by 25 basis points on Thursday, to 7.25%.

Inflation in South Africa remained below the SARB target range of 3%-6% in April, while the local currency recovered from recent losses and now trades below 18 dollars per unit.

Data released by the central bank earlier that day showed that South Africa's composite leading Business Cycle indicator increased 1.1% from month to month in March.

The yield on South Africa's benchmark government bond for 2030 was down by 5 basis points to 8.84%. Reporting by Bhargavacharya and Sfundo parakozov, Editing by Bernadettebaum and Andrea Ricci

(source: Reuters)