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Sluggish economy keeps rand on back foot

Johannesburg - The rand hovered near the previous day's five-year low versus the dollar on Tuesday, as nagging concerns about the weak outlook for the economy dampened investor appetite.

By 06:52 GMT the rand was changing hands at R10.8350 to the dollar, barely changed from Monday's New York close of R10.8250.

It was within easy reach of the previous day's session low of R10.8400, its softest level since last 2008.

The rand had rallied on Friday and early Monday after weak US payrolls data dented the case for a quick tapering of the Federal Reserve's monthly bond purchases, a programme which resulted in flows into high-yielding emerging markets.

"Most participants are reluctant to build long rand positions because the dollar is still likely to strengthen this year on the back of an improving US economy," said Absa Capital in a market note.

"The rand is likely to remain plagued by South Africa's poor fundamentals."

In fixed income, government bonds retreated, nudging the yield on the 2026 benchmark 4 basis points higher to 8.215 percent while the paper maturing in 2015 added 2 basis points to 6.18%.
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Rand - Dollar
19.07
-0.9%
Rand - Pound
24.07
-0.7%
Rand - Euro
20.56
-0.5%
Rand - Aus dollar
12.37
-0.2%
Rand - Yen
0.13
-0.8%
Platinum
899.20
+0.3%
Palladium
999.25
-0.3%
Gold
2,210.66
+0.7%
Silver
24.56
-0.4%
Brent Crude
86.09
-0.2%
Top 40
68,080
+0.6%
All Share
74,278
+0.5%
Resource 10
56,967
+2.4%
Industrial 25
103,572
+0.3%
Financial 15
16,456
-0.4%
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