JOHANNESBURG – South Africa’s rand firmed early on Tuesday, advancing alongside Asian currencies as a dollar wobble helped sustain demand for risk assets.
At 0730 GMT the rand was 0.42 percent firmer at 14.0700 per dollar compared to a close of 14.1300 overnight in New York.
The dollar measured against a basket of currencies was down 0.8 percent, subdued by easing fears of a global slowdown.
Since advancing to a more than one-month best at the end of March after Moody’s declined to issue a credit review, leaving Pretoria’s debt at investment grade, the rand has traded in a narrow range as it nears the 14.00 mark seen as the next pivot point.
With interest rates steady and inflation moderate, the currency offers one of the most attractive spreads to U.S. dollar and other low yield currencies, making it a target for carry traders.
A business confidence index release on Wednesday, and mining and manufacturing production figures on Thursday are the main data points locally, while investors will also have an eye on the tariff dispute between Washington and Beijing.
Bonds inched firmer ahead of an auction of long term government fixed instruments, with the yield on the benchmark 10-year bond down 0.5 percent to 8.51 percent.
Stocks opened flat, with the Johannesburg Stock Exchange’s (JSE) Top-40 index just shy of 52,000 points on the back of a week-long rally spurred by gains in resource and retail stocks. – Reuters