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Cape Town - The rand continued its run in after hours trade in New York after closing at R13.09/$ amid continued dollar weakness.
Bloomberg reports the greenback weakened for a fifth day as Europe’s economy picks up steam and investors assess a fresh controversy engulfing President Donald Trump.
The dollar slumped against most of its major peers after a report that Trump shared
terrorism intelligence with Russian officials, an action he has since
defended.
By 18:51, the local unit was trading at R13.06 against the greenback.
"It has been a great combination for the rand: the dollar has fallen sharply after last week’s weak inflation data; risk assets have been boosted by the record highs on Wall Street; and commodity prices have risen nicely as China’s talk of infrastructure build has outweighed weakness in its data.
"The most important of these has certainly been the dollar weakness," said RMB currency strategist John Cairns in a note to clients.
He said rand outperformance relative to other risk currencies in the past few days equals around 1%, or approximately 13 cents. "There is no obvious justification for this, but the divergence is not large enough to worry significantly."
TreasuryOne said in its weekly market view on Tuesday, the rand found a "very nice little position for itself" amid a very light data calendar and after the French election and Fed talk of the last couple of weeks.
"It seems that the rand might find some stronger footing in the short term. The calmness in the market has seen renewed vigour on Wall Street which has bolstered some risk appetite, which in turn is rand positive."
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