Johannesburg - The rand remained firmer against
the dollar in noon trade on Wednesday as it tracked a euro that had been
buoyed by encouraging data.
"The rand is firmer and we've seen fairly good buying interest locally," a local currency trader said.
"The sentiment in euro land today is somewhat more positive," he added.
At 11:33 local time, the rand was bid at R7.6941 to the
dollar from its previous close of R7.7157. It was bid at R10.1320 to the
euro from R10.1293 before, and at R12.0706 against sterling from
R12.1113 previously.
The euro was bid at $1.3170 from its previous close of $1.3129.
RMB said in a note that global markets were trading stronger
today, spurred by yesterday's good German investor sentiment data,
half-decent US retail numbers, more printing from the BoJ and, above
all, assurance from China that it would keep investing in eurozone bonds
and even support bailouts via the IMF and EFSF.
"However, there is an elephant in the room that is mostly
being ignored: today's face-to-face meeting of eurozone finance
ministers, where Greece's second bailout was expected to be approved,
has been cancelled.
"Ostensibly they need more guarantees that the new austerity
measures will be implemented. The Greek prime minister has already
provided a written promise and the other half of the coalition is
expected to provide theirs later today."
Various European countries were questioning whether this was simply an exercise of throwing good money after bad.
"Risks are clearly growing, even if the most likely outcome is
that approval will eventually be forthcoming - not at today's telephone
conference but maybe at the next meeting on February 20."
RMB said it had progressively toned down its multi-week bullish bias on the rand.
"Direction now seems evenly balanced. Clearly the Greek story
may create further risk of a rise. And the bullish signals from eurozone
bonds and money markets have been easing."
Meanwhile Dow Jones Newswires reported that the euro had been
buoyed by some encouraging data as well as China's pledge to support
Europe, although Greece remained firmly in the spotlight.
Better-than-expected gross domestic product figures from
France and Germany helped to kick the session off on a positive note.
The French economy expanded 0.2% in the last quarter of 2011, against
expectations of a 0.1% contraction. Meanwhile, the German economy
contracted less than expected in the fourth quarter, mainly due to
higher fixed investment in construction.