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POLL-S.Africa's rand to weaken but mostly weather political turmoil

* Rand to ease slightly ahead of December ANC conference

* Still underpinned by search for yield from abroad

* reuters://realtime/verb=Open/url=cpurl://apps.cp./Apps/fx-polls?RIC=ZAR= Rand forecasts

JOHANNESBURG, July 6 (Reuters) - South Africa's rand is expected to fall another 1.5 percent by year-end, a Reuters poll found, a still relatively resilient performance given leadership squabbles in the ruling ANC.

On Wednesday, three days after forecasts were collected, the rand hit a seven-week low against the dollar at 13.4975 after a week-long ANC conference proposed nationalising the central bank and expropriating land.

The median forecast from over 35 currency strategists polled June 30-July 5 suggested the rand could end the year at 13.60 against the dollar compared with 13.40 on Thursday, giving up just 1.5 percent.

"The rand is still one of the strongest-yielding emerging market currencies that provides the rand with an important source of support," said Piotr Matys, strategist at Rabobank.

"We have not seen foreign investors capitulating despite growing political headwinds. Perhaps one of the reasons is that pressure on President (Jacob) Zuma seems to be rising."

This median is 20 cents firmer than 13.80 in the June poll despite corruption watchdog Busisiwe Mkhwebane suggesting last month that the Reserve Bank be more concerned about citizens and less about the rand.

Economists polled by Reuters say South Africa's Reserve Bank should continue targeting inflation to protect living standards and not shift to prioritising growth as has been suggested in a burgeoning dispute over central bank independence.

Rabobank's Matys added that the rand outlook could change quickly if there is a shift in the broad assumption that Zuma's position on the political scene is not as strong as it was.

"The risk is that foreign investors may simply run out of patience, especially after this controversial proposal to amend the Reserve Bank mandate was revealed. For me that was a warning signal," he said.

More broadly, South Africa relies on foreign capital inflows to close shortfalls when its exports fall below its imports, competing with other emerging markets such as Turkey and Brazil.

After slipping into a technical recession in the first quarter of this year, South Africa is now forecast to grow by 0.7 percent in 2017. reuters://realtime/verb=Open/url=cpurl://apps.cp./Apps/econ-polls?RIC=ZAGDPQP

The Reserve Bank is expected to cut rates by 25 basis points to 6.75 percent in the first quarter of 2018.

By contrast, Wall Street's top banks see U.S. Federal Reserve policymakers raising the bank's key overnight borrowing rate one more time by the end of 2017 and further in 2018, something likely to favour a weaker rand if the SARB cuts rates. (Other stories from the Reuters global FX poll:) (Polling by Sujith Pai and Krishna Eluri in Bengaluru and Vuyani Ndaba in Johannesburg; editing by Mark Heinrich)