* Rand could meet resistance at 7.50/dollar
* Rand best performer among 20 EM currencies
JOHANNESBURG Feb 3 (Reuters) – South Africa’s rand
climbed as much as 1.3 percent against the dollar on Friday as
better-than-anticipated jobs data out of the U.S. boosted
appetite for emerging markets, but the currency could struggle
to make any further significant gains next week.
The rand turned out the best performance in a basket of 20
emerging market currencies monitored by Reuters, and was on
track to record its biggest weekly gain against the greenback
since early December 2011.
By 1621 GMT, the rand was trading 0.98 percent
firmer at 7.5650 against the dollar. It touched a session high
of 7.54 earlier, its strongest level since Sept. 19 last year,
in a rally triggered by non-farm payroll (NFP) data showing a
larger-than-expected gain in U.S. jobs.
Favourable data from the world’s largest economy tends to
boost risk appetite, buoying demand for high-yield currencies
such as the rand.
“The initial move in the markets post the relase of the NFP
caused the euro/dollar to rally to just above 1.32 and this
assisted the rand in gaining ground,” said William Van Rijn, a
forex trader at Nedbank.
“Technically the next target on the downside (firmer) for
the rand would be the test of 7.50, however we have been calling
for a correction, given the extent of the moves in the rand over
the last few sessions this seems likely,” he added.
Government bonds weakened slightly, with the yield on the
three-year bond closing 3.5 basis points higher at
6.43 percent. The yield for the 2026 issue added two
basis points to 8.085 percent.
The rand is up more than six percent on the greenback so far
this year, partly reversing some of last year’s sharp losses
when investors bailed out of risky assets on fears about the
impact of a debt crisis bedevilling some European countries.
(Reporting by Stella Mapenzauswa)
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