JOHANNESBURG Nov 6 (Reuters) – South Africa’s rand firmed
against the dollar on Tuesday after a well-received bond auction
and was expected to trade in a narrow range until investors know
who will be U.S. president.
The rand was at 8.6599 to the dollar at 1554 GMT, up 0.8
percent from Monday’s New York close as a cautious market awaits
the result of a close race between President Barack Obama and
Republican challenger Mitt Romney.
South Africa’s Treasury sold a total of 2.1 billion rand of
its 2031, 2036 and 2048
government bonds on Tuesday.
Bid-to-cover ratios ranging from 2.1 to 3.8 and a stronger
currency shored up government bonds, with the yield on the
benchmark 2026 bond five basis points lower at 7.645
percent and that on the 2015 paper down 0.5 basis points at
5.475 percent.
“Generally, bond yields at current levels are offering
reasonable value and I would expect them to trend downwards,”
said Jonathan Myerson, head of fixed income at Cadiz Asset
Management.
The rand has traded in a range of between 8.65 and 8.80
since the start of the week.
“The main thing is the outcome of the U.S. election,” said
Paul Chakaduka, a trader at Global Trader. “Everything else in
between could become almost irrelevant.”
(Reporting by Tosin Sulaiman; Editing by Ruth Pitchford)
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