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Johannesburg - The rand held steady against the dollar on
Wednesday in anticipation of further stimulus for the US economy, but the
prospect of a nationwide strike in the country's mining sector could weigh on
the currency in the days ahead.
At 07:14 GMT, the rand traded at R8.1800 to the dollar,
little changed from Tuesday's New York close of R8.1710.
The market is awaiting the German Constitutional Court's
ruling on the eurozone's bailout fund on Wednesday and a Fed meeting on
Thursday, which could result in another round of bond buying to aid the US
economic recovery.
Traders said expectations of quantitative easing have
benefited the rand and other emerging market currencies while putting pressure
on the dollar.
"Today and tomorrow will be crucial for most emerging
markets and the rand especially," said William van Rijn, a currency trader
at Nedbank.
"For the moment the tone is rather dollar negative
across the board and hence the rand is currently enjoying levels below
R8.20."
However, unrest in South Africa's mining sector and calls
for a nationwide strike by former ANC Youth League leader Julius Malema could
hurt the rand in the days ahead.
The killing of 44 people at Lonmin's Marikana mine last
month has triggered a wave of walkouts by miners demanding wage increases.
Addressing strikers at Gold Fields [JSE:GFI] on Tuesday, Malema called for "a
national strike in all the mines."
Analysts say this would worsen the country's current account
deficit, which widened to 6.4% in the second quarter of 2012 from 4.9% the
previous quarter.
"We continue to see Mr. Malema make his presence felt
and we have the ongoing scenario of strikes," said van Rijn. "That
will obviously not do anything for our productivity."
Government bonds were slightly weaker following the current account data published on Tuesday. The yield on the benchmark 2015 bond was up 24 basis at 5.43% and that on the 2026 paper 63 basis points higher at 7.33%.
