JOHANNESBURG: The rand firmed to a six-week high against the dollar on Tuesday as durable goods orders in the United States came in below estimates.
The rand raced to 10.8850 against the dollar from a New York close of 10.9410, shortly after the U.S. Commerce Department said non-defense capital goods orders fell 1.7 percent in September- its biggest drop in eight months.
"The magnitude of the surprise in the U.S. data would have unsettled market participants, especially as it comes so close to the Fed's policy meeting," said Sean McClagan, an economist at ETM Analytics.
The durable goods figure confounded Wall Street's expectations for a 0.6 percent gain and comes on the same day that the U.S. Federal Reserve's policy-setting group begins a two-day meeting.
The Fed will release a statement on Wednesday, with market-watchers expecting the central bank to signal that it is not yet ready to start raising interest rates.
By 1508 GMT the local unit was 0.74 percent firmer to 10.8600 per dollar, close to breaking through its next resistance level of 10.86.
Local bonds edged firmer, with the yield on the benchmark 2026 issue shedding 2 basis points to 7.92 percent.
The rand, which has been on a firmer footing since Finance Minister Nhlanhla Nene vowed to rein in South Africa's budget deficit, was boosted by a statement on Tuesday by Fitch Ratings calling the measures "supportive of creditworthiness".
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