JOHANNESBURG: South Africa's rand held steady against the dollar early on Tuesday, looking set for a fifth day of recovery from last week's weakness as global risk sentiment turns supportive.
Emerging market assets seen as risky are receiving a boost from planned economic reforms in China and expectations of continued loose monetary policy from the US Federal Reserve.
At 0637 GMT, the rand was at 10.1450/dollar, the level it closed at in New York on Monday.
The local unit is in its fifth day of recovery from a low of 10.46 hit a week ago, retracing after failing to breach 10.50 support.
"Technically this failure last week of the rand to weaken further will not be ideal for rand bears," said Oliver Alwar, a forex trader at Standard Bank, adding the bank favoured selling rallies to 10.18/22 while looking for a move below 10.07/08, and then 9.98-10.00 support.
"We are of the view that the medium-to-longer-term players are long dollars, so cannot discount a move to the downside especially if real money accounts and models begin selling."
Yields on government bonds were also steady at 8.095 percent on the benchmark 2026 issue and 5.975 percent on the 2015 note. Treasury will sell 2.35 billion rand worth of 2041 , 2030 and 2048 paper in the session. Results are due after the auction closes at 0900 GMT.
Comments
Comments are closed for this article.