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South Africa's rand hovers close to 9 vs dollar

rand--JOHANNESBURG: South Africa's rand is expected to trade within a narrow range this week but could tip above the 9.00 to the dollar level if Greece's lenders fail to agree on a bailout package.

 

The rand was at 8.8891 to the dollar at 0653 GMT on Monday, barely changed from Friday's close.

 

Traders said the currency was likely to trade in a tight range but remain below the psychologically key level of 9.00 to the dollar.

 

"We're in ranges currently, looking for some kind of move on the euro, most probably with the Greek situation," said Jim Bryson, a currency trader at Rand Merchant Bank. "The rand is likely to trade in the region of 8.85-95, at least at the beginning of this week."

 

Euro zone finance ministers and the International Monetary Fund meet on Monday to discuss how to reduce Greece's debt, which could reach 190 percent of GDP next year.

 

Further unrest in South Africa's mining sector could also weigh on the rand, Bryson said. Two workers at one of Harmony Gold's mines near Johannesburg were killed on Thursday and the Chamber of Mines said on Friday the sector could see thousands of job cuts and further clashes between rival unions.

 

"Any kind of bad news would be negative for the rand," Bryson said.

 

Government bonds were marginally weaker, with the yield on the 2026 paper 2 basis points higher at 7.640 percent and that on the 2015 instrument flat at 5.52 percent.

 

Copyright Reuters, 2012