Rand strengthens on gold

Johannesburg - The South African rand strengthened from its midday levels in late afternoon trade on Wednesday supported by an impressive gold price, with a trader saying it was likely that the currency could reach the 7.64 level sometime this afternoon.

The gold price jumped to a new record high of US$1,095.65 on Wednesday after the price continued to capitalise on the news that India had bought 200 tonnes of gold from the International Monetary Fund.

At 15:57 the rand was bid at 7.6883 to the dollar from 7.8079 at its previous close. It was bid at 11.3645 to the euro from its previous close of 11.4973 and was at 12.6977 against sterling from 12.8290.

The euro was bid at $1.4788 from $1.4716 overnight.

"We have strengthened a bit, stocks are looking better. This should be the bottom, we are still very thin," a trader said.

"The stronger gold price is also not hurting. The ADP employment figures came out in the US and those were better than expected.

"It will be interesting to see if we will hold. I think we should go to about 7.64 this afternoon," he said.

Dow Jones Newswires reported the euro strengthened against the dollar in early on Wednesday trading on higher stock markets in Asia and Europe.

But major currencies stayed within well-worn ranges, as investors looked toward an afternoon meeting of the Federal Reserve's interest rate-setting committee.

The Dollar Index, a trade-weighted basket of six currencies, was at 76.043, from 76.320.

ADP US employment data released on Wednesday showed a drop in October private-sector jobs of 203 000, which is what economists had expected. The number improved from September's loss of 254 000 private-sector jobs, but failed to substantially move major currencies immediately after its release.

Adding to a data-heavy day, the Institute for Supply Management releases at 10:00 EST its US non-manufacturing index for October, which is expected to rise to 52.0 from 50.9.

- I-Net Bridge