Friday, 14 December 2012 12:37
JOHANNESBURG: South Africa's rand firmed against the dollar on Friday, supported by a stronger euro, although a looming African National Congress (ANC) leadership election next week is keeping investors uneasy about holding the rand.
By 0654 GMT the rand was at 8.6460 to the greenback, firmer than Thursday's New York close of 8.6600.
Market analysts expect the rand to remain range bound between 8.60 and 8.70 amid relatively thin pre-Christmas trade.
"For now we're expecting rand to remain at these levels with a slightly weaker bias on the back of concerns around Mangaung and whether or not there will be any policy changes," said Brigid Taylor, head of institutional sales at Nedbank.
Mangaung is the district in the central city of Bloemfontein where the ANC holds its five-yearly leadership conference. The ruling party is also expected to make pronouncements on mining taxation and other areas of industrial policy.
On the debt market, yields on government bonds were mixed, with that on the benchmark 2026 paper down 2 basis points to 7.305 percent and that on the 2015 issue flat at 5.405 percent.
Treasury will sell inflation-linked 2025, 2050 and 2038 paper at 0900 GMT at its last sale for the year, but the auction is likely to be poorly supported amid no major concerns about the need to hedge against inflation.
Copyright Reuters, 2012