Johannesburg – The rand strengthened in afternoon trade on Tuesday as traders anticipate the World Government Bond Index (WGBI) buyback to start on Monday.
The rand strengthening is due to the WGBI and I expect this should make the rand bullish again in the near future‚” said Lynden Reabow‚ an FX sales trader for PSG Prime.
At 15:24 local time‚ the rand was bid at R8.1937 to the dollar from R8.2408 at Monday’s close. It was bid at R10.60 to the euro from its previous close of R10.6585 and at R13.2922 against sterling from R13.3688 before.
The euro was bid at $1.2945 from $1.2930 at Monday’s close.
“The rand usually takes direction from the euro but is rather quiet in that regard at the moment; investors are sitting back now because they have the stimulus. There is still a bit of uncertainty due to Spain on whether or not they will ask for more financial aid‚” Reabow said.