JOHANNESBURG Jan 4 (Reuters) – South Africa’s rand
was stable against the dollar on Wednesday after notching its
fourth straight daily gain overnight and should continue to take
its cue from global developments in the absence of market-moving
local news.
By 0658 GMT the rand was trading unchanged from its
New York closing level of 8.0570 on Tuesday.
“The rand traded quite strongly yesterday. The year started
risk-on so we had positive performances in commodities and stock
markets. The euro also strengthened against the dollar after
there was some good numbers that came out of the States,” a
Johannesburg rand trader said.
“But overnight in Asia we’ve see the euro come off from
those highs of yesterday. For today we’re probably going to
trade in an 8.00-12 range.”
From a technical perspective, a close firmer than 8.02 could
open up a rally to 7.95 for the rand.
Government bonds were little changed from Tuesday’s closing
levels as trading remains sluggish at the start of the year.
The yield on the benchmark 2015 bond was flat at
6.74 percent while the longer dated 2026 bond edged up
one basis point to 8.51 percent.
Despite last year’s global selling of emerging market assets
due to worries about contagion from debt problems in the euro
zone, South African bonds were cushioned by their high-yield
status, relative to yields in more developed countries.
“We continue to maintain the view that once the ECB’s
(European Central Bank) recent loosening begins to impact the
euro zone economy more positively, and the same happens in the
UK economy … a healthy inflow to local equity and bond markets
is set to resume,” Tradition Analytics said in a note.
(Reporting by Stella Mapenzauswa, editing by Ed Stoddard)
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