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Johannesburg - The rand firmed against the dollar on Tuesday with investors booking profits on the U.S. currency and with risk sentiment improved after Greece managed to secure a bail-out to prevent Athens defaulting on debt due next month.
The dollar came back from three-year highs fuelled by a stronger-than-expected non-farm payrolls number on Friday.
By 08:29, the local currency was at R10.1475/$, compared with a R10.1715 close in New York on Monday.
"Continued dollar profit-taking is the driver here," said Christopher Shiells of Informa Global Markets.
The dollar is going through a temporary bout of weakness but still has strong support, dealers said. Friday's better-than-expected US jobs data adds to concerns that the Federal Reserve could soon start to reduce its monetary stimulus.
The dollar index, a measure of the US currency's value against a basket of currencies, was at 84.182 early on Tuesday, back from three-year high of 84.588 hit on Monday.
Dealers say the positive relationship of the DXY index with the dollar/rand pair means the rand will need fresh impetus to test stronger levels.
"The broader stronger dollar scenario is expected to remain for a while, though to what degree will be greatly influenced by Wednesday's FOMC minutes release and Bernanke's speech. So the rand will remain driven by external influences," Shiells added.
The yield on the benchmark 2026 government bond was down 2 basis points to 8.095%.
The Treasury is looking to sell R2.35bn of debt at a weekly auction. Results are due after 11:00.
The dollar came back from three-year highs fuelled by a stronger-than-expected non-farm payrolls number on Friday.
By 08:29, the local currency was at R10.1475/$, compared with a R10.1715 close in New York on Monday.
"Continued dollar profit-taking is the driver here," said Christopher Shiells of Informa Global Markets.
The dollar is going through a temporary bout of weakness but still has strong support, dealers said. Friday's better-than-expected US jobs data adds to concerns that the Federal Reserve could soon start to reduce its monetary stimulus.
The dollar index, a measure of the US currency's value against a basket of currencies, was at 84.182 early on Tuesday, back from three-year high of 84.588 hit on Monday.
Dealers say the positive relationship of the DXY index with the dollar/rand pair means the rand will need fresh impetus to test stronger levels.
"The broader stronger dollar scenario is expected to remain for a while, though to what degree will be greatly influenced by Wednesday's FOMC minutes release and Bernanke's speech. So the rand will remain driven by external influences," Shiells added.
The yield on the benchmark 2026 government bond was down 2 basis points to 8.095%.
The Treasury is looking to sell R2.35bn of debt at a weekly auction. Results are due after 11:00.
