* Rand softer as investors opt for safe havens
* Bonds soft but inflation-linked paper well supported
* Lower electricity tariffs could boost bond market
JOHANNESBURG, March 9 (Reuters) – South Africa’s
government bonds weakened on Friday and the rand retreated
nearly 1 percent against a resurgent dollar as investors found
little incentive to take on risky assets, with nagging debt
problems in Europe still casting a shadow.
Bonds barely moved on news South Africa’s energy regulator
has cut the increase in electricity tariffs to 16 percent for
the 2012/13 financial year from a previously approved rise of
25.9 percent, although this should help ease inflation pressure.
The rand fell as much as 0.92 percent against the greenback
and was at 7.5214 by 1651, a 0.55 retreat from Thursday’s close
at 7.48. The dollar was broadly boosted by a solid U.S. payrolls
report which enhanced its safe haven appeal among investors
still uneasy over the debt crisis in the euro zone.
“Dollar/rand has been tracking the euro/dollar cross almost
tick-to-tick in the past week and remains influenced by market
sentiment,” 4CAST emerging market analyst Anisha Arora said.
“Hence today’s developments have kept the rand bulls at bay
against the currently strong dollar.”
The rand languished in the bottom half of a basket of 20
emerging market currencies tracked by Reuters.
Continued…
