JOHANNESBURG: South Africa's rand firmed on Monday, gaining alongside fellow emerging currencies as the dollar stumbled on expectations that the US Federal Reserve will not raise interest rates this week.
Stocks also ticked up, helped by gains in commodities that benefited the resources sector.
At 1512 GMT, the rand had gained 1.23 percent to 14.0150 per dollar, compared to Friday's close of 14.1900 in New York.
"Event risk this week is all about central banks, although almost certainly more about what they say than (what they) do," Rand Merchant Bank's currency analyst John Cairns said.
Markets price in just a 12 percent chance of a rate rise at the two-day Fed meeting concluding on Wednesday, while locally the South African Reserve Bank is expected to leave interest rates unchanged on Thursday.
Expectations that US interest rates will remain low boost investor appetite for emerging markets assets, which offer higher returns but carry more risk.
Government bonds firmed alongside the currency, with the yield for the benchmark government issue due in 2026 easing by 9 basis points to 8.625 percent. On the bourse, the benchmark Top-40 index gained 0.14 percent to 45,496 points, while the All-Share index rose 0.28 percent to 51,975 points.
By 1505 GMT, spot gold prices rose 0.3 percent and platinum gained 0.75 percent as the dollar slipped, with any further gains capped by jitters ahead of the Fed meeting, while positive Chinese home data continued to support local commodity demand.
"Generally when there are good Chinese numbers it means that there's going to be good demand for commodities, therefore commodity nations like ourselves generally are the beneficiaries of that," said Vunani Private Clients portfolio manager, Michele Santangelo.
Anglo American plc rose 2.77 percent to 157.01 rand, Impala Platinum Holdings strengthened 3.14 percent to 64.77 rand and Gold Fields Limited gained 0.98 percent to 68.24 rand.
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