JOHANNESBURG: South Africa's rand firmed against the dollar on Tuesday, continuing to benefit from the positive sentiment caused by a Cyprus bailout deal that averted the immediate threat of financial turbulence in the euro zone.
The rand traded at 9.2791 per dollar at 0640 GMT, 0.25 percent firmer than Monday's close of 9.3083.
"After a purported agreement reached with regards to a bailout for Cyprus, we saw the Euro gap higher and a general uptick in risk sentiment," Oliver Alwar, a senior dealer at Standard Bank, said in a client note.
"The rand was a beneficiary of this and we traded lower from New York's closing levels above 9.3000."
However, the currency continues to look vulnerable after Dutch finance minister Jeroen Dijsselbloem said the rescue program agreed for Cyprus represents a new template for resolving euro zone banking.
On the domestic front, the market will watch out for the outcome of a debt auction after 0900 GMT. Treasury is due to auction 2.1 billion rand in total of its 2023, 2031 and 2041 paper.
Government bonds were weaker, with the yield on the three year paper edging up half a basis point to 5.525 percent and that on the longer-dated 2026 issue up 1.5 basis points to 7.5 percent.
Comments
Comments are closed for this article.