Johannesburg - The rand held steady against the dollar early
on Wednesday, and may find more support in the session as protesting miners
return to work and calm investor fears about a flare up of violence in South
African mines.
Anglo Platinum [JSE:AMS] said workers at its Siphumelele
mine were clocking in for their shifts after a walk-out on Tuesday in solidarity
with colleagues hurt in a union rivalry clash the previous day.
The flare-up saw investors dump the rand, worrying it might
signal a return of the mining clashes that saw at least 50 people killed in the
platinum belt last year.
By 06:19 GMT on Wednesday, the rand had recovered losses to
trade at R8.85 against the dollar, slightly firmer than its New York close on
Tuesday.
Dealers also said foreign buying of high yielding and
relatively cheap local assets was propping up the local currency.
"We saw quite a lot of foreigners buying the bond
market yesterday. That's seen the rand strengthen to R8.85 levels. There are a
couple of foreign banks which feel that the rand is undervalued with regards to
other emerging markets," said Brigid Taylor of Nedbank.
Inflation data should also support local assets, if it comes
within market expectations. The data is for January and economists polled by
Reuters expect prices did not increase from December, remaining at 5.7%
year-on-year.
If the number overshoots that expectation, bond yields are
likely to take a hit and investors may become more aggressive at the weekly
inflation-linked bond sales, where they can hedge against the rise in CPI.
The release will for the first time use data from a
2010-2011 household spending survey. A high January number could be the effect
of the new base data on CPI, and a precursor for the rest of the year. The data
is due at 08:00 GMT.
Bond yields were down 2 basis points at 5.305% on the 2015
note and 3.5 basis points at 7.24% on the 2026 issue.
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