Johannesburg - The rand regained its footing against the
dollar on Friday, cheered by data that pointed to a soft landing for China’s
economy, although eurozone debt worries should keep gains in check.
prices held strong, still buoyed by demand from foreign accounts in search of
Yields hovered close to recent record lows, with the 3-year
and 14-year benchmarks each shedding three basis points on the day to 5.825%
and 7.665% respectively.
After falling as much as 1.6% the previous day, the rand traded at R8.3040 to the greenback by
06:30 GMT, up 0.25% from Thursday’s R8.3250 close.
It tracked other commodity currencies, such as the
Australian dollar, which rallied on data showing China’s economy grew in line
with expectations in the second quarter, bringing relief after market fears of
“From South Africa’s point of view, the fact that the
Chinese authorities have already started to loosen monetary policy and have the
ability to support their economy through fiscal measures is good news,” said
“Whether this is a reason to turn bullish on the rand is
however debatable. Offshore developments remain sobering with very few signs of
outright improvement anywhere.”
The rand remains vulnerable to risk aversion, mainly linked
to worries of contagion from the debt problems that some countries in the
eurozone - South Africa’s main trading partner bloc - are grappling with.