* Rand outperforms other EM currencies
* Bonds firmer in light of lower rates for longer
By Vuyani Ndaba
JOHANNESBURG, March 26 (Reuters) – South Africa’s rand and
bonds firmed on Monday against the dollar on the back of Federal
Reserve Chairman Ben Bernanke’s dovish comments, triggering a
large sell-off from the greenback against most emerging market
currencies.
Bernanke’s warning that the U.S. economy needed to grow
faster to get the unemployment rate down boosted hopes early in
the session that the bank could yet conduct another round of
quantitative easing.
The rand performed the best out of a group of 20
emerging markets currencies compiled by Reuters. At 1553 GMT
it was 1.02 percent firmer than the U.S dollar, trading at 7.6.
“We have basically seen offshore selling throughout the day,
we have seen the dollar weak against the euro and commodity
currencies,” said a Johannesburg trader.
“Dovish comments from Bernanke led to more selling of the
dollar across the board and that’s been supportive of the rand,”
he added.
Government bonds also firmed, with the yield on the 2015
bond dropping eight basis points to 6.750 percent and
that on the longer dated 2026 note falling 8.5 basis
points to 8.375 percent.
Continued…
