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Johannesburg - The rand firmed against the dollar in early
Wednesday trade, consolidating near five-month highs while the market awaits
direction from Greece austerity talks.
Another bout of risk appetite is likely to propel the rand
through resistance at R7.52, analysts said.
The rand was at R7.530 by 06:45 GMT, 0.3% firmer than its
previous R7.5545 close in New York on Tuesday. It touched R7.52 overnight, a
five-month high, but will need to break through the R7.52 barrier convincingly
to be a threat to the September 19 high of R7.4650.
Analysts say the market is optimistic the Greeks will
eventually agree on a programme of reforms in exchange for a bailout deal,
which is keeping risky assets in favour.
“The bias on the rand will therefore switch back towards
moving stronger,” Rand Merchant Bank said in a note.
“If there is going to be a break lower, USD/ZAR rather than
EUR/ZAR is where it will happen,” RMB added.
Yields on government bonds dropped 2.5 basis points as
prices followed the firmer tone of the rand. The 2015 bond yield was at 6.505%
and the 2026 issue stood at 8.14%.
The National Treasury will announce bond issuance plans for
next week at 09:00 GMT, after a strongly covered sale in the previous session.
Business confidence for January is expected at 09:30 GMT and
the index is seen ticking higher from 99.1 in December.