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Johannesburg - The rand was weaker against the dollar on Thursday from
its closing levels overnight, but remained within sight of recent
three-and-a-half year highs, keeping the door open for an interest rate
cut later in January.
In morning trade the unit traded at R6.72/$ against the greenback, down 0.48% from Wednesday's close at R6.69/$.
The currency however remains up 9% against the greenback since the start of 2010, buoyed by foreign investors attracted by South Africa's high-yielding fixed income instruments.
Dow Jones Newswires reported that the dollar edged up to a fresh two-week high against the yen in Asia on Thursday, as investors in the region bet that the US economic recovery would buoy the currency after a labour report overnight came in much better than expected.
But the dollar's rise was blunted as Japanese exporters sold it, dealers said.
Any further gains in the unit would likely remain moderate for the rest of the week, as expectations for further improvement in economic indicators appeared now to have been largely priced in, they added.
"The rand is still performing fantastically well although it has weakened from the (strong levels) we saw at the end of last year, but that's largely due to the thin liquidity that we've seen," Bidvest Bank chief dealer Ion de Vleeschauwer said.
"There's been a major sell-off in commodities in the last seven days and that's given the dollar globally a bit of a boost."
The Reserve Bank trimmed interest rates by 650 basis points between December 2008 and November last year, and some analysts say the persistent strength in the rand leaves room for another reduction at its next policy meeting later this month.
The JSE opened slightly higher on Thursday, after miners pulled shares down the day before.
The resource-heavy JSE Top 40 index of blue chips was up 0.59%, while the broader All-share index edged up 0.35%.
Government bonds also retreated, with the yield on the benchmark 2015 bond (ZAR157) edging up to 7.22% from 7.19% overnight, while that on the 2026 note (ZAR186) was at 8.18% from 8.15%.
In morning trade the unit traded at R6.72/$ against the greenback, down 0.48% from Wednesday's close at R6.69/$.
The currency however remains up 9% against the greenback since the start of 2010, buoyed by foreign investors attracted by South Africa's high-yielding fixed income instruments.
Dow Jones Newswires reported that the dollar edged up to a fresh two-week high against the yen in Asia on Thursday, as investors in the region bet that the US economic recovery would buoy the currency after a labour report overnight came in much better than expected.
But the dollar's rise was blunted as Japanese exporters sold it, dealers said.
Any further gains in the unit would likely remain moderate for the rest of the week, as expectations for further improvement in economic indicators appeared now to have been largely priced in, they added.
"The rand is still performing fantastically well although it has weakened from the (strong levels) we saw at the end of last year, but that's largely due to the thin liquidity that we've seen," Bidvest Bank chief dealer Ion de Vleeschauwer said.
"There's been a major sell-off in commodities in the last seven days and that's given the dollar globally a bit of a boost."
The Reserve Bank trimmed interest rates by 650 basis points between December 2008 and November last year, and some analysts say the persistent strength in the rand leaves room for another reduction at its next policy meeting later this month.
The JSE opened slightly higher on Thursday, after miners pulled shares down the day before.
The resource-heavy JSE Top 40 index of blue chips was up 0.59%, while the broader All-share index edged up 0.35%.
Government bonds also retreated, with the yield on the benchmark 2015 bond (ZAR157) edging up to 7.22% from 7.19% overnight, while that on the 2026 note (ZAR186) was at 8.18% from 8.15%.
