South Africa’s rand traded slightly firmer early on Friday, recovering from a sharp dip in the previous session after the country confirmed its first case of coronavirus.

South Africa’s rand weakened for a third session in a row early on Friday as the growing likelihood of a global recession due to the spreading coronavirus compounded an already gloomy local economic outlook.

At 0615 GMT the rand was 0.57% weaker at 18.5550 per dollar, having touched a new all-time low of 18.6500 overnight as investor hopes of limited economic fallout faded, spurring sales of riskier assets.

The greenback climbed to a 2% weekly rise on Friday, lifted by a surge in the oil price and investors searching for safety as global coronavirus infections rose, with local infections edging past 1,400 people.

Bonds also weakened, with the yield on the benchmark government issue due in 2030 adding 5 basis points to 11.21%.

“The domestic currency has been dealt blows from all sides,” said analysts at NKC Economics in a note, adding the unit could hit the key 20.00/$ level in the coming sessions as supply chain disruptions deepened and investor sentiment worsened.

“South Africa’s economic fundamentals are dismal, and the external environment has grown increasingly hostile. The loss of South Africa’s investment-grade status exerts further pressure on the rand, which is already teetering due to the economic damage inflicted by Covid-19.”

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