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Johannesburg - The rand was on the back foot once more
against the dollar on Thursday after attempting a rally back above R8.00 the
previous day, and is likely to remain hostage to global jitters about Greek
debt, with local factors taking a back seat.
Government bonds were also weaker in thin trade, with
investors preferring not to take positions until the way ahead for global
markets becomes less uncertain.
The rand was down 0.53% at R8.0460 to the dollar by 06:43
GMT compared with Wednesday’s close of R8.0035.
The rand attempted a move back to the mid R7.90’s on
Wednesday but stalled at R7.95.
It looked set to stay under pressure on Thursday, in line
with the euro, which edged lower as investors worried about the ramifications
of a possible Greek default after the debt-ridden country called for a
referendum on a eurozone bailout.
“What the market is fearing the most is a disorderly default
and that is what’s looking likely at the moment with the referendum talk coming
out of Greece,” said Alvin Chawasema, a trader at Renaissance Capital.
“Greece needs money in November and it’s clear that they’re
not going to get that money in November so that whole uncertainty and that
picture being painted out there doesn’t look great at all for risky assets.”
Bonds followed the rand weaker, and yields climbed higher,
with that on benchmark 2015 paper adding four basis points to 6.64%t while that
for the 2026 paper gained 4.5 basis points to 8.415%.
Traders said uncertainty was keeping most bond investors on the sidelines, with turnover on the Johannesburg exchange on Wednesday of less than R10bn compared with usual daily volumes of R15bn - R20bn.
