Related Articles
Top Stories
May 27 2012 11:21
There's a price war raging between South Africa's cellphone networks after Cell C lowered the rates of its prepaid calls by more than 34%.
May 28 2012 07:53
The City of Cape Town has spent R175m running the Myciti bus service since the Soccer World Cup compared to an income of R35m, a report says.
May 27 2012 13:09
The oversupply of golf estates has claimed another victim.
Johannesburg - South Africa’s rand weakened
against the dollar on Thursday but was off two-and-half week lows hit earlier
after higher than expected U.S. data boosted risk appetite.
South African government bonds also weakened in line with the rand
and are expected to stay under pressure before the National Treasury’s Budget
next Wednesday.
The rand remains vulnerable with the Greek debt crisis still
unresolved and the market will have to wait for Monday to hear whether Athens
will secure a bailout package to avert a disorderly debt default.
The rand fell as much as 1.5 percent on the day to hit 7.88 to the
dollar, its weakest since Jan 30. By 1553 GMT, it had come back to 7.8045, 0.55
percent weaker than Wednesday’s New York close of 7.7620.
“There was positive data released out of the United States and that
added positive sentiment to the market,” said a dealer at Standard Bank, adding
this positive sentiment might not last and the rand might test the 7.90 over the
next few days.
“The 7.75 level should be adequate support for dollar/rand in the
meantime and that’s where I’m sticking my stops.” the dealer added.
New U.S. jobless claims fell to a near four-year low last week, and
U.S. housing starts also beat expectations in January.
The rand is a heavily-traded currency globally which renders it
very sensitive to fickle risk sentiment and has been extremely volatile
In the fixed income market, the yield on the 2015 bond climbed by
4.5 basis points to 6.66 percent and that on the 2026 issue was up four basis
points to 8.305 percent.
Focus moves to next week’s Budget but for now, the rand is the main
driver.
Bonds, especially longer dated issues, will likely come under
pressure if the Treasury announced that narrowing the fiscal deficits will take
longer than previous forecasts, said Absa Capital in a note.