Johannesburg - The rand was firmer against the
dollar in noon trade on Tuesday as it tracked a euro that had been
lifted by expectations of a Greek debt restructuring deal.
"The markets are very interested in the prospects of a Greek
deal and everything seems to be hanging on this," a local currency
He added that SA's trade balance figures, due out later today, would only impact the rand if the data was "shocking".
The trader said private sector credit extension (PSCE) and
money supply data released by the SA Reserve Bank (SARB) early on
Tuesday morning had had no effect on the rand.
At 11:40 local time, the rand was trading at R7.7760 to the
dollar from its previous close of R7.8282. It was trading at R10.2521 to
the euro from R10.2964 before, and at R12.2414 against sterling from
The euro was trading at US$1.3195 from its previous close of $1.3138. Earlier the single currency had traded at above $1.3199.
According to the SARB, the country's credit extension to the
private sector (PSCE) grew at a rate of 6.21% year on year in December
from 6.22% y/y in November.
The rate of growth of SA's broad M3 money supply measure rose by 8.21% y/y in December from 7.23% y/y in November.
Standard Bank said in a note that the rand had retreated on
Monday, "hampered by a surge in nervousness ahead of the EU summit and
possibly also the victim of profit-taking".
After a stellar week last week, risky assets took a breather:
commodities and equity markets retreated off recent highs, as did many
emerging market and commodity currencies, Standard Bank added.
"However, comments from Greek Prime Minister Papademos have cheered the markets this morning."
The PM indicated that significant progress had been made in
the stalled PSI [private sector involvement] talks, and an agreement on
both the PSI and a new loan package should be in place by Friday.
"With concern over Greece easing and risk seemingly back on,
the rand is strengthening again this morning, in line with the Aussie
and New Zealand dollars.
"In addition, commodity prices are firmer, and Asian markets are positive after promising PMI data out of Japan."
Meanwhile Dow Jones Newswires reported that in
foreign-exchange markets, the dollar resumed its downtrend against the
euro and the yen, with the greenback disadvantaged by the US Federal
Reserve's pledge to keep interest rates low until 2014.
Greek Prime Minister Papademos' encouraging comments on
on-going debt talks, also provided broad support for regional
risk-sensitive currencies and the euro.
Papademos said after Monday's EU summit that his country had
made significant progress in talks with private-sector creditors.