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UPDATE 2-South African rand slumps on surging US Treasury yields

(Updates prices, adds analyst comment in paragraph 7)

JOHANNESBURG, Sept 26 (Reuters) - The South African rand weakened on Tuesday on the back of a surge in U.S. Treasury yields as investors turned away from riskier assets, analysts said.

At 1509 GMT, the rand traded at 19.0300 against the dollar , 1.4% weaker than its previous close.

The dollar was up 0.16% against a basket of global currencies.

"I suspect the rand is playing catch-up to the rest of the market after the long weekend," Danny Greeff, co-head of Africa at ETM Analytics, told Reuters. Trade was closed on Monday due to a national holiday.

On Monday, U.S. Treasury yields reached 16-year highs, putting pressure on South African bonds.

"The yields on some (South African government bonds are) reaching highs not seen since the onset of the pandemic as investors rotate away from risk," Greeff said.

The risk-off in global financial markets could also be attributed to worries over economic weakness globally, and the risk of overly hawkish central banks being too restrictive on monetary policy, adding to rand's softness this week, said Investec analyst Annabel Bishop.

South Africa's benchmark 2030 government bond slipped, with the yield up 12 basis points to 10.775%.

On Tuesday, central bank data showed that South Africa's composite leading business cycle indicator, which collects data on vehicle sales, business confidence, money supply and other factors, rose 0.1% month-on-month in July.

On the Johannesburg Stock Exchange, the blue-chip Top-40 index closed over 1.2% weaker. (Reporting by Tannur Anders with additional reporting by Bhargav Acharya; Editing by Nellie Peyton, Louise Heavens and Sohini Goswami and Timothy Gardner)

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