Publications
Partners
Johannesburg - The rand was stable against the dollar on
Wednesday after notching its fourth straight daily gain overnight and should
continue to take its cue from global developments in the absence of
market-moving local news.
By 06:58 GMT the rand was trading unchanged from its New
York closing level of R8.0570 on Tuesday.
“The rand traded quite strongly yesterday. The year started
risk-on so we had positive performances in commodities and stock markets. The
euro also strengthened against the dollar after there was some good numbers
that came out of the States,” a Johannesburg rand trader said.
“But overnight in Asia we’ve see the euro come off from
those highs of yesterday. For today we’re probably going to trade in an
R8.00-12 range.”
From a technical perspective, a close firmer than R8.02
could open up a rally to R7.95 for the rand.
Government bonds were little changed from Tuesday's closing
levels as trading remains sluggish at the start of the year.
The yield on the benchmark 2015 bond was flat at 6.74% while
the longer dated 2026 bond edged up one basis point to 8.51%.
Despite last year's global selling of emerging market assets
due to worries about contagion from debt problems in the eurozone, South
African bonds were cushioned by their high-yield status, relative to yields in
more developed countries.
“We continue to maintain the view that once the ECB's (European Central Bank) recent loosening begins to impact the eurozone economy more positively, and the same happens in the UK economy ... a healthy inflow to local equity and bond markets is set to resume,” Tradition Analytics said in a note.
