eBusiness Weekly
JOHANNESBURG – South Africa’s rand rose early on Tuesday ahead of economic growth data release for the third quarter ended September, amid renewed demand for risk assets as the United States and China agreed to a temporary trade war truce.
At 0650 GMT the rand was 0.5 percent firmer at 13.6225 per dollar after closing at 13.6900 overnight in New York.
The rand moved in tandem with other emerging markets which have been buoyed by thaw in tensions between the world’s top two economies as presidents Donald Trump and Xi Jinping struck a deal at the G20 summit over the weekend in Argentina.
The rand has also shaken off soft local economic data releases, with traders eyeing offshore events and technical positions as the currency tested long-term resistance around 13.50 in recent sessions.
“While most local data has not had an effect on the currency over the past weeks, one can certainly expect the GDP statistics to take centre stage. An exit from the recession will assist the rand break through the key resistance level of 13.68 to move closer towards the 13.50s,” said an analyst at Peregrine Bianca Botes.
South Africa entered recession in the second quarter of this year for the first time since 2009 due to a decline in agriculture, transport and retail sectors. A Reuters survey expects the third quarter growth to be at 1.6 percent. The GDP data for the September quarter is expected later on Tuesday at 0930 GMT.
Bonds also rose, with the yield on the benchmark 2026 paper down 1.5 basis points to 8.895 percent.
Stocks were set to open higher at 0700 GMT, with the JSE securities exchange’s Top-40 futures index up 0.84 percent. – Reuters Africa
