JOHANNESBURG: South Africa's rand climbed nearly 1 percent against the dollar on Monday, taking its cue from the firming of commodity-linked currencies although the potential for weakness remains due to the threat of mining strikes hanging over the economy.
The rand traded 0.76 percent firmer at 9.810 by 0702 GMT after ending Friday's session in New York at 9.885.
"The rand continues to trade around 9.75-10.00 so at least the range seems to be contracting slightly," Standard Bank trader Warrick Butler said in a client note.
"There certainly does seem to be a little pressure building for a move back through last week's lows of 9.774 and this could give the rand some respite to 9.66 and even 9.55, but I would expect that to be a slow grind."
In fixed income, government bonds also ticked higher and yields were inversely down from Friday.
The yield on the 2026 benchmark bond was 2 basis points lower at 7.855 percent and the 2015 issue dipped 2.5 basis points to 5.97 percent.
Despite recovering over the last few days, the rand is still down nearly 16 percent against the greenback to date this year, after a heavy sell-off in recent months as investors fretted about labour friction in mining that has slowed production of commodities for export.
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